Background
Standby rates refer to charges applied to customers who generate their own electricity but rely on the utility grid for backup when self-generation falls short. These customers are not expected to move off-grid from a utility’s distribution system but rather rely on it as a secondary source at times where self-generation is not available due to weather, maintenance or emergency repairs.
This requires the utility to maintain plant and distribution system firm capacity at the level required to meet the system’s peak load, including those of standby customers. Accordingly, self-generation customers impose a cost to the utility’s system for the utility to be able to service them. These customers pay standby charges to secure reliable access to utility-supplied electricity in the event their on-site generation is unavailable, whether due to scheduled maintenance or an unplanned outage, thereby ensuring continuity of service for the load normally served by self-generation.
In view of ongoing interest from QEC’s customers in self-generation with back-up supply from QEC, the Corporation considers it important to implement a standby service rate for the following objectives:
- Provide customers with a clear understanding of the rate structure applicable to their service should they seek standby service from QEC allowing them to make informed decisions.
- Avoid rate increases to other customers resulting from potentially under-recovering the full cost to serve standby customers
The Corporation has undertaken a review of existing standby rate practices by major Canadian electric utilities, focusing on their rate structures, design approaches, and applicability to customers. Based on this review, the Corporation developed a standby rate proposal for consideration and approval of the Minister responsible for QEC.
For more information, please review the Application for Self-Generation Customer Standby Service Rate Structure: