Additional farm electricity customers in California will soon begin paying different rates based on the time of day their energy usage occurs.
click image to zoom Beginning early next year, eligible small and medium-sized agricultural customers in the Southern California Edison Co. service area will be moving to time-of-use electricity rates. The change affects Edison agricultural and agribusiness customers on PA-1, PA-2, GS-1 and GS-2 rates.
Karen Norene Mills, California Farm Bureau Federation associate counsel and director of public utilities, said the change comes in response to a mandate by the California Public Utilities Commission for development of demand-response programs to encourage reduced electricity usage during times of high energy demand.
Time-of-use rates are typically lowest when demand is lowest, with rates reaching their highest levels on weekday afternoons during the summer months, when demand is highest.
Edison is the second of the state's large, investor-owned utilities to institute the rates; Pacific Gas and Electric Co. is currently in the process of transitioning to time-of-use rates, and changes are in the works for San Diego Gas and Electric.
In early 2014, most Edison customers will begin the transition to time-of-use rates.
"Because the transition to TOU rates will only occur after a customer has access to at least 12 months of recorded usage data from an interval meter, typically a newly installed smart meter, not all PA-1 and PA-2 customers will be transitioned to a TOU rate in 2014," Mills said.
Unlike a flat rate, the new system charges different rates depending on the season and the time the energy is used. During the summer months, from June through September, Edison will establish rates based on three periods: on-peak, with the highest energy cost; mid-peak, with medium energy costs; and off-peak,which offers the lowest energy cost. During the winter months, from October through May, only mid-peak and off-peak rates will be in effect.
"Time-of-use rates more accurately reflect the costs of energy at the time it is used. During on-peak periods, there is the greatest demand on the grid," said Russ Garwacki, Southern California Edison director of pricing. "When you shift energy use, if possible, to mid-peak or off-peak periods, you help reduce strain on the grid and are able to save money."
Businesses on an Edison GS-1 or GS-2 rate will start transitioning to time-of-use rates effective Jan. 1. Agricultural businesses on a PA-1 or a PA-2 rate will begin the transition on Feb. 1.