Hydro-Quebec’s new variable rates could save customers $ 150 per year, according to the utility

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Hydro-Québec is asking for a 0.8% rate hike as of April 1, but it promises that if they so wish, consumers will be able to obtain discounts ranging from $ 30 to $ 150, thanks to the “pricing” program. variable ”proposed by the company.

In announcing its annual rate hike request on Friday, Hydro stressed that the proposed increase remains below the projected rate of inflation.

“This is the fourth consecutive year that our candidacy [for a rate increase] is lower than the inflation rate, ”Éric Filion, the recently appointed president of Hydro-Québec Distribution, told reporters.

Option to reduce peak usage

The New Twist is a voluntary program to reward consumers for reducing their energy use during peak periods.

The plan is for the utility to notify participants by text message during peak winter periods when they should reduce their consumption.

Electric heating represents half of a household’s total consumption, so Hydro-Québec could suggest lowering the thermostat at these times.

Éric Filion, president of Hydro-Quebec Distribution, announced on Friday that the utility wanted a rate increase of 0.8% and variable pricing, which could save consumers up to $ 150 on their bills. electricity.

Other major electricity-consuming activities, such as doing laundry, washing dishes or taking a shower, could be postponed to off-peak hours.

“It will depend on the actions of the consumer to reduce their consumption,” said Filion.

The utility expects up to 20,000 customers to choose to subscribe to the variable pricing option in the first year of the program.

Reduce the need to import electricity

In addition to saving money for its customers, Filion said, variable pricing would allow Hydro-Quebec to reduce costly purchases of energy from utilities in neighboring states and provinces.

“It’s a win-win,” Filion said.

Consumers can choose between two options.

Option 1 offers a credit of 50 cents per kWh during the winter period from November to March, if the consumer takes measures to reduce his electricity consumption during peak hours, in response to a text message from Hydro-Québec.

Peak energy consumption hours in Quebec are 6 a.m. to 9 a.m. and 4 p.m. to 8 p.m.

Hydro-Québec smart meters allow variable pricing. (SRC)

Option 2 offers a discount of 2 cents per kWh in winter. Customers would pay around 6 cents per kWh rather than the average rate of 8 cents per kWh for the winter months.

But option 2 also provides for the payment of 50 cents per kWh over the first 100 hours of winter consumption.

The 50-cent charge would be a clear incentive to reduce consumption or shift consumption to cheaper off-peak hours.

Filion said that under variable pricing, lowering the thermostat one degree would save $ 75. A reduction of two degrees would save $ 150 compared to the winter season.

Smart meters provide detailed usage data

The variable pricing option offered by Hydro-Québec is made possible thanks to the new generation of smart meters in the public service.

Old meters only measured total electricity consumption.

New meters can accurately show how much electricity a customer is consuming and when.

Both the rate increase and the dynamic pricing proposal must be approved by the Régie de l’énergie du Québec, the Régie de l’énergie du Québec.

The Régie is an autonomous provincial regulatory body that does not always grant Hydro-Québec the rate increases it requests.

Last year, Hydro-Québec asked for a 1.1% increase. The board ruled that this increase was not justified, keeping its 2018 increase at 0.3%.

Hydro-Quebec says the 0.8% increase is needed to modernize its transmission and distribution network and apply measures, such as tree pruning, to minimize power outages.

In addition, the utility forecasts a 4.1 terawatt-hour increase in electricity sales in 2019-2020, representing 1.1 TWh for households, 1.4 TWh for commercial customers and 1.6 TWh for industrial projects. , such as mines.

One terawatt hour is equal to one billion kilowatt hours.

Still the lowest rates in North America

Filion said that without the proposed tariff increase, the utility would lose $ 84 million in 2019-20, based on anticipated revenues of $ 12.2 billion.

He noted that Hydro-Quebec offers the lowest electricity rates in North America.

In Ontario, consumers pay almost twice as much, and residents of Boston and New York City pay four times as much for electricity than Montrealers.

Filion has defended the utility rate increases, claiming that over the past 20 years, electricity rates in Quebec have increased by 26 percent, while the consumer price index, measuring inflation , rose 40 percent and the price of gasoline at the pump rose 82 percent. hundred.

Sensitive to criticism from the Régie de l’énergie, Hydro-Québec is ready to develop flexible payment plans for consumers in economic difficulty and also offers them energy efficiency options.

The regulatory approval process for rate increases and variable rate plans begins with a period of detailed analysis by the Régie, followed by public hearings and deliberations by the Régie, ending in February.

Hydro-Québec expects a decision by March 2019.


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