Ontario's new ultra-low electricity rate is a win for the wallets of electric vehicle owners, says the head of Electric Mobility Canada, a national advocacy group already calling for other provinces to follow suit.
"At the lowest rates, it becomes really, really, really cheap, when you charge at home," president and CEO Daniel Breton, a former Quebec environment minister, told Yahoo Finance Canada. "That's something we think should be deployed across the country."
The Ontario government rolled out its new ultra-low overnight electricity price option through the Ministry of Energy on Monday, dropping the overnight rate from 7.4 to 2.4 cents per kilowatt hour every day between 11 p.m. and 7 a.m. In exchange for that 67 per cent savings from the current off-peak rate, those who choose the new option will pay a 59 per cent higher price during dinner time and in the evening. The government estimates customers could save up to $90 per year.
The new plan is a third option alongside existing Time-of-Use (TOU) and Tiered plans aimed at those who use more electricity at night, such as electric vehicle owners, shift workers, and those with electric heating. The pricing plan is not yet available to all Ontario residents. Currently, just eight of Ontario's 61 provincial power utilities offer the new price. But all are required to offer it within six months.
For electric vehicle owners, Breton says the ultra-low rate plan "makes total sense," saving households money while shifting demand from charging to a time of day that's less stressful for electricity grids. Those networks are growing more complex as Ontarians adopt electric vehicles, and more renewable energy like wind and solar contribute intermittent power to the grid.
"A lot of people are thinking that the grid won't be able to handle the EV uptake in the months and years in front of us," Breton said, noting Ottawa's targets for new light-duty vehicle purchases.
The federal government wants zero-emissions vehicles to account for 100 per cent of new purchases in this category by 2035, with interim targets of at least 20 per cent by 2026 and at least 60 per cent by 2030.
According to S&P Global Mobility's Canadian automotive report, battery-electric and plug-in hybrid vehicles accounted for 10.2 per cent of all new vehicle registrations in the fourth quarter of 2022.
Blake Shaffer, an economist and energy expert at the University of Calgary, told Yahoo Finance Canada in 2021 that he and his wife had been charging their Tesla at the "worst time of day for the system writ large," lacking a financial incentive to charge at night.
At the time, he said he expected EV owners won't care if their car charges at 5 p.m. or in the middle of the night after it's plugged in, as long as it's ready for use in the morning.
"Think about what people are willing to do to save a few cents a litre on gasoline. People drive across town to save a few cents," he said. "So if you're being told, 'Hey, you can fuel your [electric] car at half the cost, or get a discount on your bill if you hand over some of these controls,' I think people are more open to those types of things in the transportation space."
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.