Electricity rate design
We’re looking to change how our rates are structured and this could impact your bill. In our recent rate design application to the British Columbia Utilities Commission (BCUC), we recommended phasing out the current two-tier electricity rate over a period of four years, which would result in a flat rate by the fifth year. If approved, these changes would come into effect beginning in 2019.
What is rate design?
To better understand the potential impacts for your bill, it’s important to understand the difference between rates and rate design.
The rate you pay for your electricity covers the cost of providing you with electricity service. That includes everything we do to bring electricity to your home, from buying or generating electricity to sending it along the many power lines, substations and poles in between. Through rates, we collect enough revenue to maintain the safe, reliable grid we all count on every day.
In contrast, the rate design determines how rates are structured; that is, how much revenue is collected from each customer class, such as residential or commercial, so that each customer class is fairly charged for their share of the cost of providing their service.
Like most utilities, FortisBC reviews their rate structure periodically to make sure these costs are distributed fairly. In December 2017, we submitted a Rate Design Application to the BCUC recommending changes.
What we’re recommending and why
In our application to the BCUC, we recommended two primary changes for residential customers: the phasing out of the two-tier rate over four years, with the flat rate coming into effect in the fifth year and offering an optional time-of-use rate to customers. Any changes resulting from our rate design application are revenue neutral for FortisBC. That means we collect the same amount of revenue regardless of a single or two-tiered rate structure, or how quickly we phase out the two-tiered rate.
Proposed time-of-use periods and rates
(Dec - Feb)
(Mar - Jun / Sep - Nov)
(Jul - Aug)
|On-peak||7 a.m. to 12 p.m.
4 p.m. to 9 p.m. weekdays
|12 p.m. to 9 p.m. weekdays||22.435¢|
|Mid-peak||12 p.m. to 4 p.m. weekdays||7 a.m. to 9 p.m. weekdays||7 a.m. to 12 p.m.
|Off-peak||9 p.m. to 7 a.m. weekdays and all day weekends and holidays||9 p.m. to 7 a.m. weekdays and all day weekends and holidays||9 p.m. to 7 a.m. weekdays and all day weekends and holidays||9.280¢|
*These suggested rates are subject to change pending regulatory review.
What does this mean for you?
If our application to phase-out the two-tiered rate is approved and customers are once again billed on a flat rate, it will likely result in slight annual bill increases for lower energy use customers who have benefited from the two-tier rate, while providing savings for the higher energy use customers who have experienced higher bills as a result of the two-tier rate. The annual impact on individual bills varies greatly, depending on your electricity use.
To find out the potential impact to you, try our calculator.
Get involved with the process
As a regulated utility, customers can be assured that any changes to our rates or how they are structured are all vetted through a transparent and rigorous public process with the BCUC.
To find out more about the proceedings, visit bcuc.com.