ComEd time-of-use pilot will test importance of price certainty
- Commonwealth Edison has filed with Illinois regulators a proposed four-year time-of-use (TOU) pilot program, seeking to compare its current real-time offering to one that gives customers a better sense of the cost of their energy supply.
- The utility has offered its Real-Time Pricing Program for a decade, but has heard from customers that the lack of price certainty is a barrier to signing up.
- The TOU pilot was developed in collaboration with the Environmental Defense Fund (EDF) and the Citizens Utility Board (CUB). The groups say they expect the new rate program to roll out in January 2020.
Almost all of Commonwealth Edison's customers could benefit from real-time pricing, the utility concluded last year in a study produced with the CUB and EDF. But the research didn't provide any answers on how to convince customers to sign up.
EDF officials say the existing Real-Time Pricing Program "has produced great savings for participants, while helping to reduce peak demand" and will remain available to customers. Over the years, ComEd has collected data to show program participants save about 15% on their electric supply costs, compared with a fixed-price plan, and have saved 47 million kWh since 2007.
The new TOU pilot would "simply serve as another tool in the toolbox to help people take greater control of their energy use," EDF spokesperson Catherine Ittner told Utility Dive.
In ComEd's filing with the Illinois Commerce Commission, the utility explained that despite the real-time pricing program being around for a decade, "some customers who would otherwise benefit from the program indicate that the lack of price certainty is a barrier to enrollment."
ComEd's real-time program offers customers a dashboard allowing them to track a variety of price trends, though ultimately they are billed the PJM real-time hourly market price. While it is relatively straightforward, there is also the potential for peak-demand price spikes, a need to keep an eye on day-ahead pricing, and the possibility for negative pricing.
The Real-Time Pricing Program is a significant change from the standard fixed-price plan, and ComEd officials say they want to know if a simpler system might bring more people on board.
"The residential TOU Pilot will provide the opportunity to understand if a more price certain supply rate based upon the difference in real-time market-based rates is appealing to residential customers," according to the utility's proposal. The pilot would offer "an easy to understand supply option with similar benefits to the residential real-time pricing program for customers and creates a middle ground between fixed and real-time pricing."
The proposal is "a big step in the right direction for ComEd," CUB Executive Director David Kolata said in a statement while acknowledging the challenges ahead.
"A lot of work remains to develop this plan and educate consumers about it, but if we’re serious about building a more affordable, more reliable and cleaner power grid, time-of-use pricing has to be part of the blueprint," he said.
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