While the OEB was setting Regulated Price Plan (RPP) prices under the Fair Hydro Act, 2017, the “final RPP variance settlement amount” was no longer required to serve the purpose for which it was designed. The OEB therefore suspended the operation of the “final RPP variance settlement amount” mechanism for customers that left the RPP on or after July 1, 2017.
Effective November 1, 2019, the OEB is once again setting RPP prices under section 79.16 of the Ontario Energy Board Act, 1998 and in accordance with the OEB’s Standard Supply Service Code and the Regulated Price Plan Manual. Electricity distributors should monitor this webpage for updates regarding the final RPP variance settlement amount.
On April 1, 2005, the OEB’s Regulated Price Plan (RPP) came into effect. As of July 1, 2005, a consumer who leaves the RPP will either pay or receive a “final RPP variance settlement amount”. This amount will reflect the consumer’s share of any accumulated variance between the actual price paid to generators and the forecast price paid by price plan consumers. If consumers have been paying more for electricity than was paid to generators, this amount will be a credit. If consumers have been paying less, it will be a charge. The variance account that tracks the difference is held by the Independent Electricity System Operator (IESO).
The “final RPP variance settlement amount” applies to a price plan consumer who: (1) cancels their account and moves outside of the Province of Ontario; (2) switches to a retailer; (3) elects the spot market pricing option; or (4) no longer remains eligible for the Regulated Price Plan. This amount will be referred to as “RPP settlement” on the electricity bills of applicable consumers and will be calculated by the consumer’s distributor. If the consumer was on RPP prices for a continuous 12-month period prior to exiting the RPP, the distributor will multiply the applicable “final RPP variance settlement factor” by the individual consumer’s consumption over the most recent 12 months. If the consumer was on RPP pricing for less than 12 months prior to exiting RPP, they will receive a pro-rated settlement based on their actual consumption for that less-than-12-month period multiplied by the applicable settlement factor.
In calculating the final RPP variance settlement amount for consumers leaving the price plan, distributors will use the final RPP variance settlement factor that is in effect (posted on this web page) on the date of the consumer’s final meter read. Therefore, due to the time lag between a meter read and billing, the factor used in the calculation may be different from the value that appears on this web page when the consumer receives their bill. A Compliance Bulletin discusses this matter in further detail.
The table below shows the current “final RPP variance settlement factor”. The information on this web page will be updated by the OEB on a monthly basis. It will be used for billing purposes by electricity distributors and retailers (using retailer-consolidated billing) for consumers who left the price plan. When the IESO has paid more to generators than has been paid by consumers, the RPP settlement is a charge and these values will not be shown in brackets in the table below. It will be a credit to consumers when these values are shown in brackets.
The OEB has calculated the “final RPP variance settlement factor” by dividing the balance in the IESO’s variance account by the total consumption of all price plan consumers over the most recent 12 months. An estimate of the “OPG Rebate” currently attributable to price plan consumers has been taken into account in this calculation by subtracting it from the IESO variance account balance to arrive at a “net” variance account balance.
What does the current “Final RPP Variance Settlement Factor” mean to a residential consumer that leaves the Regulated Price Plan and is eligible for a full-year settlement?
An RPP consumer using an average of 1,000 kWh per month would owe $22.50 if they left the RPP. [1,000 (kWh/month) x 12 (months) = 12,000 kWh x $0.001875 per kWh = $22.50]
An RPP consumer using an average of 750 kWh per month would owe $16.88 if they left the RPP. [750 (kWh/month) x 12 (months) = 9,000 kWh x $0.001875 per kWh = $16.88]
Final RPP Variance Settlement Factor
posted on June 15, 20174
(To see previous Settlement Factors, click here)
Net Variance Account Balance (accumulated IESO variance account balance less the estimated “OPG Rebate”)3
Total RPP consumption for most recent 12 months (June 2016 to May 2017)
Final RPP Variance Settlement Factor 1
(1) The "final RPP variance settlement factor" is shown in both cents/kWh and $/kWh to accommodate different billing systems. Both are links to an XLSX file that distributors and retailers can automatically download into their billing systems. This data is also available as an XML file. The current variance file can be accessed through the XML link above, and the folder directory can be accessed from the following location: https://www.oeb.ca/documents/rpp_variance