Unintended consequences of BC Hydro’s two-tier billing
The issue of BC Hydro’s two-tier billing is beginning to make the news again and I’m pleased that the new government has committed to looking into it.
Back in 2016, I received correspondence from a number of constituents expressing frustration over the-two tier billing system. I shared and continue to share their concerns. On May 27, 2016 I wrote a letter to Bill Bennett, the then Minister of Energy and Mines, asking for more information.
Electricity (produced from renewable sources) is the cleanest form of heating. We should be encouraging (not discouraging) its use. The idea that multi-tier pricing enhances conservation and efficiency, while theoretically correct, has obvious detrimental consequences. It inadvertently incentivizes fossil fuel use for heating and hot water. It also doesn’t differentiate between large and small homes, the number of people in a particular dwelling or if you drive an electric vehicle. For many, it is simply impossible to stay within Tier 1 year around.
A far more attractive approach would be to introduce time-of-day billing. By charging different rates at different times of the day (which is easy to do since the introduction of smart meters), rate-payers could optimize their energy usage (and help stabilize the electricity load). For example, cheaper rates in the evening or the night (where demand is low) would encourage people to charge their electrical vehicles then (instead of during the day). Programmable dishwashers, dryers and other appliances could also access this cheaper energy.
I look forward to seeing the elimination of the two-tier system. If this is an issue that is important to you, I encourage you to contact the Minister of Energy, Mines and Petroleum Resources at: EMPR.Minister@gov.bc.ca
Latest Posts
Recent Comments
- on The Paris Agreement is in trouble: UNFCCC needs to ratchet up their climate efforts
- on The Paris Agreement is in trouble: UNFCCC needs to ratchet up their climate efforts
- on How can BC’s environmental organizations be more effective?
- on How can BC’s environmental organizations be more effective?
- on How can BC’s environmental organizations be more effective?
18 Comments
The only way our minimum-wage earning family has been able to
stay under tier 2 billing has been to NOT heat our bedrooms.
We are in an apartment & now pay roughly $90 a month on equal billing plan, to heat ONLY: combined living room-dining room, run our stove & fridge, and electric lights, computers etc. (no laundry at all.)
There is something very very wrong with the system as it now is. We are paying 3X MORE for less heat than in the past. In 1986 we paid $30 a month to totally heat & run everything in a 1 bedroom apartment.
Years later — no heat in our bedrooms (by choice to keep bills lower) –and we sleep in mittens, long johns, and hats, as well as coats, and use many blankets….. BC Hydro you have FAILED us as average people forced to used your service…..
Our wealthier friends just skip hydro and install air-tight stoves that use wood or use gas fireplaces to heat their abodes. As lower income renters though, we don’t have those options here on Vancouver Island. Glad BC Hydro rates have at least been temporarily frozen from the April 2018 planned-increase.
Tier 2 kills us every month. We bought a Mini-split heat pump last year so that we wouldn’t have to burn so much wood and help clean up the air around here where lots of people have woodstoves. Hydro wants us to use less power but that’s not possible for us unless we burn wood. Hydro has put us in a Catch 22 situation. This needs to change.
They will gouge us no matter what system is used. Will they use the second tier during the day and then go to the 1st tier during the night? I doubt it.
Your commenters sound like upper middle class people as they can afford solar upgrades, EV’s and second houses. Not I. There are a lot of us out here who make less than 20,000 a year.
In 4 years time they will eliminate our E+ rate category for electricity for uninterruptible electricity for heating w/ back up appliances (usually wood stoves). When they do that I will be unable to afford electricity for heat. I will be unable to afford to upgrade my insulation and I will be in my early 70’s and unable to earn the money required to do said.
Not looking forward to the continuing price gouging and lack of compassion shown to the people of BC by the over paid and under regulated power industry of BC. They are just another group of professionals milking the system.
Given that the intent of time of use billing is to essentially incentivise the shifting of consumption to fill demand ‘valleys’, I support this idea. It would allow us to continue for many years without adding costly new generation. I would happily charge my EV at night (no reason not to) and ponder what else I could shift to the cheaper periods.
My only concern would be that this might be used by BC Hydro as an opportunity to discourage grid-tied home solar.
I heat and cool with a geo-exchange system. My power bills are therefore always in the second tier and all my solar essentially offsets my higher rate.
If net metering remained in place and the rate during the sunny hours remained close to the second tier…great! If it was higher… even better! But if my offsetting suddenly happened at a lower rate, I can’t say I’d be happy. PV is a costly investment, made with the expectation that power rates would remain stable, or perhaps increase over time.
Whatever is proposed, it shouldn’t serve to reduce the uptake of home grid-tied solar!
Awash in nat gas but banned from using it in BC ie burrard thermal mega generator
Happy to know both the Green Party and the NDP are looking into this unfair system of billing for electricity.
We recently moved into our home in Langford which only has hydro service for everything. This lot missed the cutoff for the gas line by three houses up the street. Very concerned for the coming cold months as I have heard many stories of desperate situations regarding the electrical bill. We would consider solar panels if there was more of an incentive to invest the initial dollars++ required to have solar power.
I just moved from Ontario where we had time-of-day billing (and smart meters). While it appears to work great for regular households, and I liked it personally, it did promote a shift/decrease in usage. But it had the unintended consequence of hurting some businesses since they have to generally use most of their electrical power during the daytime, when the rates were the highest. And they don’t always have the option of moving their electrical usage from day time to night time.
Andrew: Thanks for raising this issue to the broader public. There are several problems with the current 2 tier residential rate. The first is that the ratchet point was set based on typical consumption for residences into lower mainland with low heating days and access to cheaper natual gas. This is unfair to customers who can’t get natural gas or who live in colder parts of the province. Secondly, the residential rate works opposite to commercial, institutional and industrual rates where many large conusmers actually get a break as consumption increases. Thirdly, where natural gas is available, high electricity rates encourage conversion to cheaper fossil fuel heating, putting the environment at risk. A time of day rate may not help much as energy for heating (when needed) is a 24 hour proposition. I would prefer to see more sophisticated rates that balance system cost related to peak demand with multi-tier rates that recognize consumer location and avilability of natural gas and some kind of disincentive charge for hiigh consumption during peak periods. We live in Cadboro Bay wher narual gas is not available. We have recently uopgraded our windows, insulaion and electric heating. Our home here is smaller than a house we own in Edmonton, yet we pay way more for heating here than there where winter is much colder and heating is via gas. Had gas been avilalbe when we were renovatng we would have converted. In my view the 2 tier rate is a significant disincentive to use renewable energy.
Hard to feel sorry for you Dave…awe
Which house should we live in today…
Hydro has been ripping us off ever since we the people allowed them to stuff the smart meter down our throats…if most of the province said NO it wouldn’t have happened…
But the sheeple stood passively by…
I thought the 75$ per bill legacy charge was too much to continue paying …
As sometimes it Doubled my bill…last winter I paid 400 a month…the latest bill is only 229..
Thieves…and nothing more
Andrew, you are absolutely correct. The current two tier system simply penalizes those of us who would virtually exclusively use clean hydro power. Heating with electricity means I’m nearly always paying the high rate. A two tier system based on time of use rather than amount of use would help level out demand and allow individuals to better manage their costs. This has been proven in many other jurisdictions for decades.
Thanks so much for raising this issue! I raised the same points last year in a submission to the BC Utilities Commission enquiry into inclining block rate pricing. It apparently fell on deaf ears since the BCUC fully supported the two-tier rate in their final report.
I think it’s time there was some new thinking at the BCUC. Clean power use is not something to be discouraged through a punitive price structure. Time-of-day and even day-of-the-week billing will not only encourage efficient energy use, but the most efficient use of the existing energy grid through better load balancing and peak energy demand reduction. Other constituencies have had this for years. But of course, that would be yet another reason why we really don’t need Site C…
I did an energy audit, maxed my insulation and weatherproofing and installed a high efficiency electric furnace. I can’t reschedule my space heating requirements. Guess I’ll have to burn a fossil fuel since your proposed fix doesn’t address the issue.
Your proposal sounds like a re-packaging of the existing two-tier system. How does this address the fact that we want to get away from “inadvertently incentivizes fossil fuel use for heating and hot water.”
Your proposal sounds like a re-packing of the existing two-time system. How does this address the fact that we want to get away from “inadvertently incentivizes fossil fuel use for heating and hot water.”
There should be a flat rate, period. The two-tier has always seemed suspect to me; what was initially stated has not been the outcome, and I am definitely paying more. The time of day is wrong, even more; I use electricity during the day for what are essentials, and I cannot somehow shift them to non-peak hours. That system would be even worse.
Thank you for raising this issue. As a corollary, a switch to “clean” electricity or geothermal for heating would surely reduce our carbon footprint.
Sure dislike stating the obvious but here goes…isn’t the suggestion here to move from one two tier system to another? And is the idea to put all trust in the (not so) smart meter to decide how much we pay…as we have been forced to already? And all in the name of energy conservation? Just another ruse perpetuated on the unsuspecting.
I thoroughly agree with you. I drive an EV and would absolutely use the charging timer to charge overnight if there were an advantage t this. Also dishwashing. Glad to know this is on your radar.