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Monthly Market Report

This report provides a summary of key market data from the IESO-administered markets. Any data provided in this report is for information purposes only and should not be used for settlement purposes. All currency data is reported in Canadian dollars ($CAD).

Note: Operational and settlement data will be available on the 20th calendar day of each month, for the previous month. Global Adjustment by component and transmission rights clearing account data will be available on the 28th day of each month, for the previous month.

 

For historical reports prior to January 2020, see

Year
Month

Click on generate button to create monthly graphs and data below.

Market Prices

 

This section provides information on several key prices in the Ontario wholesale electricity market. A brief description of each reported price item is included. For more information on any of the price items, please refer to appropriate market rules, market manuals and training materials, or contact IESO Customer Relations.

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Hourly Ontario Energy Price (HOEP)

Ontario 5-Minute Market Clearing Price (MCP)

Operating Reserve Prices

Transmission Rights Market

Transmission Rights Payments

Transmission Rights Clearing Account


Hourly Ontario Energy Price (HOEP)

HOEP is the hourly price that is charged to Local Distribution Companies and other non-dispatchable loads. HOEP is also paid to self-scheduling generators. HOEP forms part of the commodity charge in the retail electricity market for customers who purchase their electricity from their Local Distribution Company. Customers who have arranged contracts with licensed retailers are not affected by HOEP, but instead are charged their particular contract rate for the commodity.  

 

Note: The IESO provides a graph of HOEP prices for the current and previous day on the Power Data webpage. These graphs also provide an estimate of projected HOEP prices. The estimates for future HOEP are extracted from internal IESO calculations and are updated every hour. All projected prices are derived by simulating a supply/demand balance, using prices offered by suppliers in the market, prices bid by dispatchable loads in the market, and the IESO's forecast of the total demand for electricity in the province. The actual supply/demand balance can vary from these projections for a number of reasons:

  • The actual demand for electricity can fluctuate as factors such as weather, temperature, amount of cloud cover, and wind etc., affect the amount of electricity used by consumers.
  • At the same time, operational difficulties, unexpected generation losses or delays in a generation unit returning from an outage can result in higher priced generation being called on to fill the gap.
  • Changes in interjurisdictional trade.

 

This graph shows daily average HOEP prices for the month.

 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/

 
 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/ or http://reports.ieso.ca/public/PriceHOEPAverage/

Note: On-peak average price is the straight arithmetic average of HOEP in hours 8 to 23 (EST), Monday to Friday (5 x 16). Off-peak average price is the straight arithmetic average of HOEP for all remaining hours in the week. The wholesale market does not use a formal definition of on-peak and off-peak hours. The IESO is providing this calculation purely for information purposes, and uses this definition throughout the year.

 

 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/


Ontario 5-Minute Market Clearing Price (MCP)

The Ontario 5-minute MCP is the price paid to dispatchable generators and charged to dispatchable loads. All other participants are charged or paid using hourly prices. The 5-minute price is calculated immediately after the fact for every 5-minute interval, using the unconstrained dispatch algorithm. The algorithm takes generator offers to sell and dispatchable load bids to buy and dispatches these resources to achieve a supply-demand balance, and resulting price. The price is posted within 5 minutes of the conclusion of an interval on the Power Data page in the “Price” tab. The 5-minute price, by its nature, will fluctuate more than the HOEP (an arithmetic average of the 12 MCPs for any particular hour), as it more directly reflects the short-term supply/demand variations caused by unexpected fluctuations in the demand for electricity or by equipment breakdowns.

 

Source: http://reports.ieso.ca/public/RealtimeMktPriceYear/

 

 

Source: http://reports.ieso.ca/public/RealtimeMktPriceYear/


Operating Reserve Prices

Operating Reserve is stand-by power or demand reduction that can be called on with short notice to deal with an unexpected mismatch between generation and load. Operating Reserve is purchased by the IESO in amounts needed to meet the reliability rules established by the North American Electricity Reliability Corporation (NERC), and the Northeast Power Coordinating Council (NPCC). The IESO recovers the required funds to pay for the purchased operating reserve from all customers in the wholesale market, via hourly uplift settlement charges.

The IESO purchases defined amounts of Operating Reserve from participants via three real-time markets: a 10-minute synchronized reserve market, a 10-minute non-synchronized reserve market, and a 30-minute reserve market.

Like energy dispatch instructions, Operating Reserve schedules are determined every 5 minutes, with a resultant price for each type of Operating Reserve for every 5-minute interval. The IESO’s decisions on who will provide the market with Operating Reserve, and who will supply the market with energy, are integrated to arrive at the optimum market outcome. This creates a strong correlation between the energy price fluctuations and the fluctuations in reserve prices.

 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/

 

 


Transmission Rights Market

The Transmission Rights Market is a financial market that is based on the import and export of electricity on the interconnection lines between Ontario and its surrounding markets in Manitoba, Quebec, New York, Michigan and Minnesota. When the interconnection lines reach their limits, energy prices can differ between Ontario and its surrounding markets. The Transmission Rights Market allows participants to buy financial protection ahead of time, to hedge against the possible price differences. These transmission rights are financial only. They do not give the holder of these rights any scheduling priority and do not limit other participants’ access to physical transmission across the interconnection lines.

The Transmission Rights contracts are auctioned off by the IESO. Successful bidders pay the market clearing price for the particular Transmission Right, in return for the right to receive revenues from the IESO in amounts proportional to the financial congestion that may occur over that interface for the duration of the contract.

Results from this month’s Transmission Rights Market are below. Specific information on auctions is available on the Market Calendars page. All figures are $/MW and are rounded to the nearest dollar.

 

 

 


Transmission Rights Payments

The holders of Transmission Rights Contracts own the right to receive congestion payments from the IESO whenever congestion results in differences between the Ontario price and the relevant external zone price. The table below shows the payments that a holder of a 1 MW Transmission Rights Contract received from the IESO in this month. These payments are made to holders of either Long-Term Transmission Rights Contracts that encompass this month, or Short-Term Transmission Rights contracts for this month.

 

 


Transmission Rights Clearing Account

The table below provides the activity of the Transmission Rights Clearing Account on a monthly basis for the past 6 months. It shows the revenues from the Transmission Rights Market, congestion rents from the market, interest earned on the balance and the Transmission Rights payments to Transmission Rights holders in millions of dollars. Long-term auction revenues are allocated evenly over the applicable 12-month term and the table below does not include revenues from future months. As per Chapter 8, section 4.18 of the market rules the reserve threshold as set by the IESO Board is equal to $20 million.

 

Market Demand

Market Demand Definitions and Graphs

The graph below plots values for both Total Market Demand and Ontario Demand.

Total Market Demand represents the total energy that was supplied from the IESO-Administered Market.

The IESO calculates Total Market Demand by summing all output from generators registered in the Market plus all scheduled imports to the province. It is also equal to the sum of all load supplied from the Market plus exports from the province, plus all line losses incurred on the IESO-controlled grid.

Ontario Demand represents the total energy that was supplied from the IESO-Administered Market for the purpose of supplying load within Ontario.

It is also equal to the sum of all loads within Ontario which is supplied from the Market, plus all line losses incurred on the IESO-controlled grid.

 

Source: http://reports.ieso.ca/public/Demand/

 

 

Imports & Exports

The graph below plots both daily average imports to Ontario and daily average exports from Ontario during the month. Economic imports and exports are scheduled into/out of Ontario on an hourly basis, up to the physical capabilities of the IESO-controlled grid and the interconnections between the systems.

 

Source: http://reports.ieso.ca/public/IntertieScheduleFlowYear/

 

 

Unavailable Capacity

 

Demand for electricity varies greatly; from hour to hour, from day to day, and from season to season. The amount of generation available for operation also varies greatly over these same timeframes. This graph shows the total capability of generation within Ontario that is unavailable for operation. These quantities are published by the IESO several times per day in the Adequacy Report. The daily values in this graph are calculated by summing the average hourly MW quantities of the following:

  • capacity of generators on planned and forced outages
  • capacity of planned and forced deratings
  • bottled capacity
  • 2% of generator outages, derates and bottled capacity
  • unscheduled capacity from Intermittent, Self-Scheduling, and Transitional Scheduling Generators

The values are taken from the most up-to-date Adequacy Report at any point in time. 

 

Source: http://reports.ieso.ca/public/Adequacy2/

Longer-Term Trends

 

This section provides graphs that display average quantities over longer periods of time. This longer-term perspective shows seasonal variations. Additional background information on some of these graphs is available on related graphs in previous sections.

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Daily Hourly Ontario Energy Price (HOEP) Trends

HOEP Prices (Monthly Arithmetic Ave)

Operating Reserve Prices (Monthly Arithmetic Ave)

Comparison to Neighbouring Control Area Prices

Average Differences between HOEP and Pre-dispatch

Henry-Hub Natural Gas Closing Price

Daily Market Demand Trends

Monthly Energy Totals

Monthly Energy by Fuel Type

Imports/Exports per Intertie Zone (Monthly Total)

Daily Maximum Unavailable Capacity Trends


Daily Hourly Ontario Energy Price (HOEP) Trends

 


Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/ 


HOEP Prices

 

Source: http://reports.ieso.ca/public/PriceHOEPAverage/


Operating Reserve Prices

 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/


Comparison to Neighbouring Control Area Prices

 

 


Average Differences between HOEP and Pre-dispatch

 

Source: http://reports.ieso.ca/public/PriceHOEPPredispOR/


Henry-Hub Natural Gas Closing Price

 

 

Source: https://www.eia.gov/dnav/ng/hist/rngwhhdM.htm


Daily Market Demand Trends

 

Source: http://reports.ieso.ca/public/Demand/


Monthly Energy Totals

 

Source: http://reports.ieso.ca/public/Demand/


Monthly Energy by Fuel Type

 

Note: The current month is based on preliminary data and is subject to change.

Source: http://reports.ieso.ca/public/GenOutputbyFuelMonthly/


Imports/Exports per Intertie Zone (Monthly Total)

 

Note: Imports are depicted as above zero and exports are depicted as below zero.

Source: http://reports.ieso.ca/public/IntertieScheduleFlowYear/


Daily Maximum Unavailable Capacity Trends

 

Source: http://reports.ieso.ca/public/Adequacy2/

 

Global Adjustment

 

Global adjustment (GA) is the difference between the total payments made to certain contracted or regulated generators, and conservation programs, and any offsetting market revenues. The GA charge is applied to all consumers in Ontario, including those who pay the market price (HOEP) and those who have signed a contract with a licensed electricity retailer. For customers on the Regulated Price Plan (RPP), it is factored into the rate set by the Ontario Energy Board.

The GA is calculated as a total dollar amount for each month based on the difference between market revenues and the following components:

Wind

  • Includes projects under Renewable Energy Supply, Renewable Energy Standard Offer Program, Large Renewable Procurement, and the Feed-in-Tariff program

Biomass, Landfill and By-product

  • Includes projects under Renewable Energy Supply, Renewable Energy Standard Offer Program, Feed-in-Tariff, converted OPG Atikokan and Thunder Bay facilities, and NUG contracts with the IESO

Hydro

  • Facilities with agreements through Renewable Energy Supply Program, Renewable Energy Standard Offer Program, Hydroelectric Contract Initiative, Hydroelectric Standard Offer Program, and the Feed-in-Tariff programs. Also includes OPG's facilities that fall under the Hydroelectric Energy Supply Agreement.

Nuclear (non-OPG)

  • Bruce Power nuclear 

Natural Gas

  • Natural gas facilities as well as OPG’s Lennox (dual fuel)

Solar

  • Includes projects under Renewable Energy Supply, Renewable Energy Standard Offer Program, Large Renewable Procurement, and the Feed-in-Tariff program

Other Programs – IEI and Storage

  • An Industrial Electricity Incentive (IEI) Program: An incentive for eligible consumers in Ontario to increase industrial production. Eligible activities include building a new, or expanding a facility, in a specific NAICS Canada 2012 sector. 
  • Storage: Includes facilities operating under the Phase II energy storage program

Funds and Financing

  • Includes programs supporting community group in the design and delivery of renewable energy initiatives. It also includes contract penalties received from generators.

Conservation

  • Conservation programs including Save on Energy and Grid Innovation Fund (formerly Conservation Fund)

Ontario Power Generation – Regulated Nuclear and Hydro

  • Regulated rates for OPG’s nuclear and remaining hydro generation set by the Ontario Energy Board

Ontario Electricity Financial Corporation – Non-Utility Generation

  • Contracts administered by the Ontario Electricity Financial Corporation with existing generation facilities

 

Customers with an average peak demand over one megawatt and some customers with an average peak demand of between 500 kilowatts and one megawatt are eligible to pay for GA based on a coincident peak calculation (i.e. Class A customers). All other customers pay GA based on the total amount of electricity they used for the month (i.e. Class B customers). For more information on how Class A and B customers pay the GA, see: http://www.ieso.ca/sector-participants/settlements/global-adjustment-components-and-costs. The total GA amount and the actual Class B rate are depicted below.

 

Source: http://www.ieso.ca/Sector-Participants/Settlements/Global-Adjustment-for-Class-B

 

The graph below highlights the components of the GA amount. The GA amounts increase or decrease in response to changes in HOEP. When HOEP is lower, the GA is higher to cover the additional payments such as for energy contracts, and regulated generation.

 

Source: http://www.ieso.ca/-/media/Files/IESO/Power-Data/price-overview/GA-by-Components.xlsx?la=en

Wholesale Market Electricity Charges

 

A summary of this month’s market results that correspond with the charge items indicated in the chart below.

 

Notes:

  • Rates published in this report are estimated average system-wide costs. Market participants should refer to their settlement statements for actual costs allocated to them.
  • Monthly rates are calculated using preliminary and final settlement information available as of the publication of this report.
  • Year-to-date rates are since January 1 of the report year and are calculated using preliminary and final settlement information available as of the publication of this report.

Sources: Commodity Charge HOEP: http://reports.ieso.ca/public/PriceHOEPAverage/;  Actual Global Adjustment Class B Rate: http://reports.ieso.ca/public/GlobalAdjustment/; Hourly Uplift CMSC and Hourly Uplift IOG: http://reports.ieso.ca/public/HourlyAndMonthlyCharges/

 

There are two commodity charges quoted above. The arithmetic average price would be representative of the average commodity charge for a customer whose electrical demand is relatively consistent throughout the day, the night and the weekends. The weighted average price would be applicable to a customer whose consumption mirrored that of the total system. The actual average commodity price paid by a wholesale customer will be very sensitive to their consumption pattern.

The Wholesale Transmission Charge listed above has been calculated by summing all transmission-related fees paid by all loads in the province, and dividing that sum by the total energy delivered to those loads. As such, this number is not representative of the fee paid by any particular customer. Rather, each customer’s actual fee for transmission service will depend on many factors such as peak consumption pattern and the types of transmission services applicable to the customer.

 


Renewable Generation Connection

In addition to the wholesale market charges listed above, participant invoices now include settlement amounts to recover certain costs incurred by distribution companies for the connection of new renewable generation to their local distribution system.

These charges are covered under charge type 1463 - Renewable Generation Connection  Monthly Compensation Settlement Credit. Costs are charged to participants based on their proportion of Allocated Quantity of Energy Withdrawn (AQEW) for the month, including embedded generation for LDCs. The monthly rates are summarized below:

 

 

The recovery of these costs was enabled by Regulation 330/09, and the amounts are approved by the Ontario Energy Board. Further details regarding the decision EB-2010-0191 can be found on the OEB website: http://www.ontarioenergyboard.ca.