By Cameron Mitchell
Solution 105 Consulting Ltd.
“DAYS GETTING LONGER”
As the sunshine starts to make a prolonged daily appearance, those with solar panels might consider moving to their high micro-gen fixed electricity rate. For the rest of us, search for a low fixed rate. February spot rates came in around 13 cents per kWh. March and April’s forward rates suggest those months will be coming in at around 17 cents per kWh and 13 cents per kWh, respectively. We highly recommend locking in a fixed electricity rate for your homes if you have not done so already.
The forward market for natural gas is similar to last month. The balance of 2023 is expected to come in around $3/GJ. This being the case, we suggest moving to a floating rate if your current fixed rate is above $4/GJ. Forward market gas rates for calendar 2024 to 2027 are in the $4/GJ range.
One great feature of these fixed-rate residential options is that they can be terminated at no cost if a better offer comes along.
Natural Gas Only:
- Unless you have a fixed rate under $4/GJ, we recommend getting onto Direct Energy REGULATED Services. DERS. This is the default, no retailer rate. It is a floating rate. Check with your current provider to ensure there are no cancellation fees, etc.
Electricity Only: The best-fixed rate options:
- Abode Power has a little bit of power left unfilled at 10.59 cents per kWh option on a three-year plan. Admin of $7.35 per month. Free termination. Deposit required.
- ATCO Energy has a 12.69 cents per kWh option on a five-year plan. Admin of $8.99 per month. Free termination.
- Many different Utilitynet providers have 28.50 cents per kWh rates available. If your home exports more electricity than it uses, you could swap to this rate. Acorn Energy is one of many options.
AT MY HOUSE
On March 1st, I moved my gas supply off the three-year renewal offer from ATCO for 5.99 cents per kWh and $3.99/GJ (and an admin fee of $6.99 per meter per month). I was told that moving my gas would not impact my fixed electricity rate or come with any gas cancellation fees, but I have heard stories from others who did not get the same feedback – so, best to double-check and get something in writing.
I am now floating on DERS for gas and still with ATCO at 5.99 cents per kWh for electricity. If I didn’t have this plan in place, I would go with DERS floating rate for gas and the Abode Power three-year plan for electricity as soon as possible. If rates drop or something better comes along in the future, the contracts can be terminated at no cost.
Short-term spot pricing sits in the $3/GJ range. With that in mind, we recommend moving to a floating rate.
For March, the Direct Energy Regulated Services (“DERS”) default rate is $2.222/GJ. Approximately $0.57/GJ of this figure is to rebate from previous overcharges. We expect March will be approximately $3/GJ.
As the forward market is suggesting electricity rates will be much higher than the current fixed-rate retail offers available, we would highly recommend moving to a fixed-rate offer if you are not already there.
Forward pricing currently suggests index residential rates will come in around 17 cents per kWh in March and 13 cents per kWh in April. February averaged about 13 cents/kWh on the floating index.
If I were to pick an electricity-only option today, I’d go with the three-year term with Abode Power at 10.59 cents per kWh.
Just to help put things into perspective, we are talking about the commodity rates and costs, not the delivery and other regulated charges. An average house might use around 9,000 kWh and 100 GJ over a year.
And for those of you who are not residential users and maybe a bit bigger, give us a call. We are seeing better pricing for commercial users compared to residential users, and we can help you get the lowest rates for your business.