The Canadian electricity market is complex in nature. There are several products, endless terms, various purchasing methods and a constant fluctuation in price. Not to worry, we can help you get organized and provide you with all the information you’ll need to make the best decision for your company, even if that decision is to do nothing. Your time will not be wasted calling several retailers and sorting through various “terms and conditions”. Our goal is to provide you with the information and tools you need to make the best decision for your company. We can provide a tender from several retailers, tell you the in’s and out’s of the industry so you can be comfortable and confident with your decision. NXT Level Energy Inc. is not affiliated with a specific retailer in any way; we offer you unbiased advice and consulting.
THE OPEN MARKET
The Canadian electricity market has been deregulated since 2005. This means that you have the choice of purchasing your electricity supply on the open market or signing a contract with a retailer. If you remain on the open market, your electricity usage will be supplied by your local utility company and you will pay the variable rate charged by the utility. The rate reflects the utility’s cost of purchasing electricity on the spot market, plus any associated administrative charges. The utility company is not allowed to make a profit on this process and simply passes on their cost to you. Below is a graph illustrating the historical weighted average market price:
If you choose to sign up with a retailer, you are able to choose between a variety of short to long-term contract options. Retailers usually offer a fixed price contract, ranging from 1 year to a maximum of 5 years. Doing this will allow you budget and forecast your future electricity cost for contract period. If the market price rises above your contracted price, then you would save money. However, if the market price falls below your contracted price, your electricity cost will be higher then that of the market.
Some retailers also offer a Block product, which offers a set price for electricity during a predetermined time of day. For example, an On-Peak 5 x 16 Block would fix your electricity cost for 5 days of the week (Mon – Fri) for 16 hours per day (7 AM – 11 PM). A product of this nature would protect you from price fluctuations on the open market during hours of high demand.
Regardless of the method you choose your electricity supply will never be cut-off. Even if you are transitioning between a utility company and a retailer or vice-versa, you will always have adequate supply.