How Type 3, 4 and 5 electricity tariffs differ

Types 3, 4 and 5 share the same per-unit energy rate within the same voltage level and rate structure. They differ in the per-kW demand charge outside the TOU rows and in rate options: Type 3 offers normal and TOU; Type 4, TOD and TOU; Type 5, TOU (a temporary rate applies pending a TOU meter). Normal and TOD rates of Types 3–4 are for existing customers only; all new customers go on TOU under current PEA (Provincial Electricity Authority) and MEA (Metropolitan Electricity Authority) announcements.

The threshold for each type is based on business size. Type 3 starts where the small-business threshold (Type 2) ends, and Type 2 covers demand below 30 kW. Type 4 is a large business with demand of 1,000 kW or more. A medium business (Type 3) whose three-month average consumption exceeds 250,000 kWh/month also moves into Type 4. The monthly units used for the comparison are the average of the previous 3 months. Type 5 is hotels and residential rental businesses that are past the same small-business threshold. How size is measured and rounded is covered in the chapter on the factory electricity price per unit.

The demand-charge rows in the table are read under one condition throughout the page: the normal rate and TOD charge on the highest value in the whole month, while TOU charges only the On Peak period. Per-kW figures on rows of different rate structures cannot be compared directly. The voltage level in the column heading is the level at which the business receives power. The kilovolt boundary between medium and low voltage is written differently in the PEA and MEA announcements, which is covered in the chapter comparing the two utilities.

A factory expanding production until it nears the Type 4 threshold

A factory installing a new set of machines sees the peak demand on its bill climbing every month toward the large-business threshold of 1,000 kW or more. Every past bill has been charged under the Type 3 table. Before ordering more machines, the owner wants to know which rows of the tariff table change if the factory crosses into Type 4, which rows stay the same, which rows are charged newly, and whether a hotel in Type 5 uses the same set of tables.

What rates does Type 3 offer, and how do the normal rate and TOU differ (3.1 · 3.2)?

Type 3 has two rate structures. The normal rate (3.1) is available only to customers who were already on Type 3.1 before the cut-off period; it has one demand-charge row and a single energy rate for the whole day. TOU (3.2), which every new customer joins, charges demand only in the On Peak period and has two separate energy rates, On Peak and Off Peak.

Per-kW figures on the 3.1 rows and the 3.2 rows cannot be compared directly because of the measurement-basis condition above the table. Always read them together with the kilowatts measured under each structure. How demand is measured and the rules that follow are covered in the chapter on the demand charge.

The three columns are high, medium and low voltage, according to the level at which the business receives power under its contract. The kilovolt boundary between medium and low voltage is written differently in the PEA and MEA announcements, which is covered in the chapter comparing the two utilities. The On Peak and Off Peak periods of TOU are divided by day and time in the announcements, which is covered in the chapter on TOU periods.

How does the normal rate (3.1) charge demand and energy at each voltage level

The normal rate (3.1) has two rows at every voltage level: one monthly demand-charge row, and an energy charge that is the same for every unit throughout the day. The figures for all three levels are in the Type 3 normal rate (3.1) rows of the table above.

The high-voltage level of the normal rate is Type 3.1.1, medium voltage is Type 3.1.2 and low voltage is Type 3.1.3. The low-voltage figures come from the same announcement.

Both rows at the high-voltage level are lower than at the medium-voltage level. The effect on the bill is that a business receiving power at medium voltage pays more per kW and per unit than a high-voltage business using the same amount of power every month.

How much does TOU (3.2) charge for On Peak demand only and for On/Off energy

TOU (3.2) has three rows: the monthly On Peak demand charge, the On Peak energy charge and the Off Peak energy charge. Kilowatts used in the Off Peak period are not counted in the demand-charge row. The figures are in the Type 3 TOU (3.2) rows of the table above.

The On Peak energy charge of TOU is higher than the energy charge of the normal rate at the same voltage level, while the Off Peak energy charge is lower.

The high-voltage level of TOU is Type 3.2.1, medium voltage is Type 3.2.2 and low voltage is Type 3.2.3.

The effect on the bill of a TOU business is that the share of units used in the On Peak period determines whether the total energy charge is higher or lower than the normal rate, and peak kilowatts that occur outside the On Peak period do not add to the demand charge.

How does Type 4 differ from Type 3 (4.1 TOD · 4.2 TOU)?

The TOU side of the Type 4 table matches Type 3 in every figure. What differs is the non-TOU side: Type 3 has the normal rate (3.1) with a single demand-charge row, while Type 4 has TOD (4.1) with two demand-charge rows, On Peak and Partial Peak.

Type 4 is a large business with demand of 1,000 kW or more. A medium business (Type 3) whose three-month average consumption exceeds 250,000 kWh/month is also moved into Type 4. The monthly units used for the comparison are the average of the previous 3 months. In the MEA area, the announcement states clearly that the business enters rate 4.2 from the month after the TOU meter is installed.

Per-kW figures on the 4.1 rows and the 4.2 rows cannot be compared directly under the same measurement-basis condition.

What is TOD (4.1), and how does it charge demand differently in the On Peak · Partial · Off Peak periods

TOD divides the day into three periods: On Peak, every evening, charges the full demand-charge row; Partial Peak, during the daytime, charges only the portion of kilowatts above the On Peak value; and Off Peak, at night, has no demand charge.

TOD has three rows in the table: the monthly On Peak demand charge, the monthly Partial Peak demand charge, which is charged only on the portion above the On Peak value, and an energy charge that is the same in every period. The figures are in the Type 4 TOD (4.1) rows of the table above.

The high-voltage level of TOD is Type 4.1.1, medium voltage is Type 4.1.2 and low voltage is Type 4.1.3.

The energy charge of TOD equals the energy charge of the normal rate (3.1) at the same voltage level, at every level. What differs is the demand charge, which is split into two rows, and the per-kW figure of the On Peak row is higher than the single row of the normal rate at every voltage level.

The effect on the bill of a business on TOD is that evening kilowatts are charged in the On Peak row, which is more expensive than the other rows. A business that can cut its evening load pays for the daytime portion in the Partial Peak row only on the kilowatts above the On Peak value, and pays no demand charge for night-time kilowatts. A Type 3 business moved up into Type 4 enters TOU (4.2), not TOD, because TOD is open only to those who were already on Type 4.1 before the cut-off period.

Does TOU (4.2) of Type 4 use the same figures as TOU of Type 3

Yes, it uses the same set of figures throughout: the On Peak demand charge and the On Peak and Off Peak energy charges, across all three voltage levels.

The high-voltage level of Type 4 TOU is Type 4.2.1, medium voltage is Type 4.2.2 and low voltage is Type 4.2.3. The figures in the Type 4 TOU (4.2) rows of the table above match the Type 3 TOU rows in every position.

The effect for a business already on TOU is that the per-kW and per-unit charges on the bill do not change when it is moved from Type 3 to Type 4.

What changes is the type code in the announcement (from 3.2 to 4.2), and the choice of rate structures does not increase.

How does Type 5, hotels and residential rental businesses, differ from Types 3 and 4?

Type 5 applies the TOU rate to every customer, and all nine TOU values are the same as the TOU of Type 3 and Type 4 in every position. Customers without a TOU meter are charged a separate temporary set of rates for now.

Type 5 (specific business) is hotels and residential rental businesses that are past the small-business threshold (Type 2), which covers demand below 30 kW. The effect on reading the table is that a hotel has no normal-rate menu like Type 3 and no TOD like Type 4. The permanent table has one set only, TOU, and the temporary rate applies only while no TOU meter has been installed.

What does Type 5 charge once a TOU meter is installed

Type 5 with a TOU meter installed has three rows in the table: the monthly On Peak demand charge, the On Peak energy charge and the Off Peak energy charge. Every value matches the TOU rows of Type 3 and Type 4 at the same voltage level.

The figures for all three levels are in the Type 5 specific business, TOU rate rows of the table above.

The effect on a hotel's bill is that units used in the On Peak period are charged the higher TOU energy rate, while units in the Off Peak period are charged the lower rate.

The day and time of each period are covered in the chapter on TOU periods.

What does Type 5 charge as the temporary rate when no TOU meter is installed yet

A specific business (Type 5) without a TOU meter is charged a temporary rate with two rows: a monthly demand charge, charged on the highest value in the whole month in the same way as the normal rate, and an energy charge. The figures are in the temporary-rate rows of the table above.

The energy charge of the temporary rate equals the energy charge of the normal rate (3.1) and TOD (4.1) at the same voltage level, at every level. What differs is the demand charge per kW.

The effect on the bill is that a hotel without a TOU meter pays a single energy rate for the whole day for now, and moves onto the TOU table once the meter is installed.

Do codes 5.1 and 5.2 of PEA and MEA mean the same rate

No, the item numbers are swapped: in the PEA announcement, item 5.1 is TOU and item 5.2 is customers without a TOU meter. In the MEA announcement, item 5.1 is the non-TOU rate and item 5.2 is TOU.

The rate figures of the two utilities are identical, but the item numbers used to refer to them are swapped. Even the electricity bill calculator menu on PEA's own site orders the Type 5 item numbers differently from PEA's announcement. The effect for the reader is to read Type 5 codes only according to the announcement of the utility that issues the bill. If you see code 5.2 in a PEA rate announcement, it means the temporary rate for customers without a TOU meter, but the same code in an MEA rate announcement means the TOU rate.

Who are the normal rate (3.1) and TOD (4.1) for, and can a newly opened business use them?

A newly opened business cannot use them. The normal rate (3.1) and TOD (4.1) are reserved for existing customers. Every new customer goes onto TOU (3.2 or 4.2) under the announcements of both utilities.

In the PEA area, an existing customer means one that was on the normal rate or TOD before the monthly bill of Nov 2015. In the MEA area, an existing customer means one that was using power before Oct 2000 and is still on the normal rate or TOD. A business that starts using power after the cut-off period of its own area is entitled to the TOU rows only.

An existing customer can choose to move from 3.1 to 3.2 or from 4.1 to 4.2, but once moved cannot return to the previous rate. The move carries cost conditions that differ between the two utilities; details are in the chapter on switching to the TOU rate. The effect on how a reader reads the table is that an older business that still holds the entitlement can compare both rows of its own type, while a new business reads only the TOU rows and can skip the normal-rate and TOD rows entirely.

When can the type change, and when is a factory reaching the threshold moved into Type 4?

A factory is moved when it meets either criterion: demand reaches the large-business threshold of 1,000 kW or more, or the three-month average units of a medium business (Type 3) exceed 250,000 kWh/month.

The monthly units the utility uses for the comparison are the average of the previous 3 months. In the MEA area, the announcement states that the business enters rate 4.2 from the month after the TOU meter is installed. The effect on an expansion plan is that once the new machines push demand or total units to the threshold, the table applied to the bill becomes the Type 4 table, and under the PEA announcement it does not revert to Type 3 even if power use falls later.

A Type 4 business that uses less power in some month and falls below the threshold is still charged under the Type 4 rate. Under the PEA announcement, the only way down is to Type 2, when demand stays below 30 kW, the small-business threshold, for 12 months in a row and the following month is still below the threshold. How kilowatts are measured and rounded is covered in the chapter on the factory electricity price per unit. Before ordering the new machines, add the rated load that will run at the same time to the peak demand on the current bill and check whether the total crosses the kilowatt threshold. This total is a precautionary estimate, not a value measured by the utility. Also estimate the three-month average units after the expansion against the unit threshold alongside it.