Making Sense of Energy

Is the New Enmax Choose Free Option a Good Choice for You?

Enmax has come out recently with an updated Choose Free rate. This time around the rate is 7.79 cents per kWh (down from 8.48 cents). The rest of their offer is pretty well the same as the original Choose Free Option. You have to sign up gas and electricity and you are committed for 5 years. Electricity will be free for one of those five years (up to the first 9,627 kWh… that is about 800 kWh/month), and gas can either float plus $0.99/GJ or be fixed (the current fixed rate is $5.99/GJ). A fair bit to consider here. Assuming one year is 100% free, their offer leads to a 6.23 cents per kWh rate… this rate sounds pretty good but before you sign up let’s examine it a little deeper to see if it really is.

Let’s compare this option with what I have at Bow Valley (7.15 cents per kWh) and DERS. I use about 100 GJ each year, and about 700 kWh per month. As I am under 800 kWh per month, I would get a full free year, so my rate would average down to 6.23 cents and my savings would be about $77 per year for the electricity rate. I would pay $19 more in admin fees. On the gas side, I am somewhere close to paying $100 more per year. So I still have a net loss of around $40 per year. And I have to be locked in. No good for me.

If you are someone who uses 800 kWh/month and 60 GJ per year, the dynamics are a bit different. Your electricity rate savings would be around $88, though you would still pay about $19 more on admin. On the gas side, you would be close to paying around $60 more annually. So your net savings is now $10/month. Not bad. But maybe not good enough to trade off the flexibility of being committed to the contract for 5 years. Tough call. You could help the economics by taking the free year first, then getting more efficient in years 2 to 5. To us, the economics seem to really hinge on the annual gas use. If you use less than around 60 GJ, it may work out.

Just to help put things into perspective, all that we are talking about here is the commodity rates and costs, not the regulated and other delivery charges. An average house might use around 9000 kWh and 100 GJ over a year. A 1 cent/kWh savings means $90/year. A $1/GJ savings would be $100/year.

Here is a quick table with a few scenarios:

Scenario12345
Gas Use (GJ/yr)100606012060
Elec Use (kWh/yr)84009600900096007200
Elec Savings$77$88$83$88$66
Extra Cost for Admin$19$19$19$19$19
Extra Cost for Gas$100$60$60$120$60
NET Savings (Loss)($42)$9$4($51)($13)

Ultimately, we look at the Choose Free option, and still think most people will be better off with DERS for gas and a Utilitynet company for electricity. Check out our ‘Residential Energy Rates in Alberta: What to Do? – September 2014 Edition’ for more information in your area.