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Interruptible Rate Pilot

Sector Evolution

In November 2021, the Ministry of Energy (ENERGY) posted a proposal on Ontario’s Regulatory Registry entitled Interruptible Rate Pilot and Administrative Review of Ontario Regulation 429/04. In August 2022, ENERGY issued a letter asking the Independent Electricity System Operator (IESO) to work with ENERGY towards designing a three-year interruptible rate pilot. The IESO is expected to report back to ENERGY on a detailed pilot design proposal by December 9, 2022. If the proposal is approved to proceed, the pilot would begin on July 1, 2023 to align with the Industrial Conservation Initiative (ICI) cycle.

The Interruptible Rate pilot will address stakeholder feedback received during the government’s 2019 Industrial Consultation specific to the challenges of identifying and responding to peak demand events while participating in the Industrial Conservation Initiative (ICI). The pilot will be targeted towards large electricity consumers connected to the transmission system as well as some hydrogen producers, where participants are charged Global Adjustment (GA) at a reduced rate in exchange for agreeing to reduce consumption during system or local reliability events, as identified by IESO.

Offering an interruptible rate pilot would allow consumer interest to be gauged and the design and potential for a broader offering to be studied. Elements of the pilot including some eligibility requirements, design of competitive selection process, GA pricing design and activation process will be informed through consultation with stakeholders.

Three pricing design options have been provided by ENERGY for stakeholder consultation and feedback. Additionally, ENERGY has requested IESO design the pilot such that it provides a system benefit and a benefit to pilot participants, while minimizing potential cost transfers to other electricity consumers. Simplicity is also critical, to ensure that financial settlement is as straightforward as possible and to encourage participation among eligible consumers. Finally, the pilot should be designed with the potential for a permanent program in mind. A list of further parameters was included for the IESO to adhere to in designing the pilot.

The IESO encourages all potential pilot participants to participate in this engagement. The IESO anticipates that this initiative will be of particular interest to transmission-connected load customers as well as hydrogen producers. All comments and enquiries on this engagement can be directed to engagement@ieso.ca.

Schedule of Activities

Anticipated timing for this engagement is presented below.

Timing

Engagement Activity

Expected Actions

January/February, 2023 (TBC)

Final design documents posted and application window open.

January 2023

Stakeholder webinar:

  • IESO to present draft design documents to stakeholders for feedback.

December 9, 2022

Report back to ENERGY:

  • IESO to report back to ENERGY on a detailed pilot design proposal and proposed participant selection process.

November 28, 2022

Following the November 23rd engagement webinar, the IESO is seeking feedback from participants on the proposed rate design and criteria.

Feedback Received

 

November 23, 2022

Engagement webinar

The IESO will report back to stakeholders on the feedback received through the October consultation sessions and summarize how it will inform the report back to the Ministry.

Recorded Presentation

This webinar was presented during the IESO's November stakeholder engagement sessions, see full agenda for more information.

November 1, 2022

Following the focused consultation sessions with potential pilot participants, the IESO is seeking feedback on a number of questions related to initial design elements of the Interruptible Rate Pilot.

Feedback Received

November 23, 2022: IESO Response to Stakeholder Feedback

October 2022

Focused consultation with potential pilot participants: