Demand Response – Commitment Option
How is the total credit calculated?
For each consumption period, the total applicable credit is calculated by adding:
- the fixed credit,
- the variable credit,
- the multi-year commitment credit (if applicable),
- the short notice credit (if applicable).
Note: To receive the full credit, you must fulfill the commitment you made under the DR Option. If you do not fulfill your commitment, a charge (penalty) will be deducted from the credit.
AN IMPORTANT BASIS FOR CALCULATION
Power demand reduction goal
The power demand reduction goal (or interruptible power goal) refers to the number of kilowatts (kW) that your company undertakes not to consume during a peak demand event. This goal is determined when you sign up for the DR Option, based on your company's capabilities and the target potential reduction.
To help companies keep track of this goal, we provide them with a power demand threshold each month, which they must not exceed during an event.
To help companies meet their demand reduction goal, we calculate a power demand threshold for them every month. We start with the usual maximum power demand for the month and subtract the company's power demand reduction goal, to obtain the threshold that must not be exceeded that month during a peak demand event.
Power demand threshold
Maximum power demand for the current month (kW) – 95 % of the reduction goal (kW) = Power demand threshold (kW)
You will still receive the fixed credit, but it will be reduced in accordance with the applicable terms and conditions.
Not while the agreement is in effect, during the winter period.
Fixed credit
The fixed credit is the credit applied to your bill in exchange for your commitment to reduce your power demand. It is offered in combination with the variable credit.
Options:
The fixed credit is the product of the power demand that you committed to curtail and the amount of the credit per kilowatt, based on the sub-option you selected.
The total credit is applied to your bills for the winter period.
Fixed credit
Power demand reduction goal (kW), if met, × fixed credit per kilowatt ($/kW) = fixed credit amount ($)
Multi-year commitment credit
Signing an agreement for more than one year gives you access to the multi-year commitment credit.
Note: If the agreement is terminated before it ends, an early termination charge will be deducted from the credit.
Duration of agreement
1 year
Non applicable
2 years
5 %
3 years
10 %
Multi-year commitment credit
Fixed credit ($) × % applicable = amount of the credit for multi-year commitment ($)
For example, a company:
- who made a 3-year commitment,
- whose power demand reduction goal is 155 kW,
- who selects the sub-option with a maximum duration of peak demand events of 40 hours, Monday to Sunday,
- and who meets its goal for the entire duration of the billing period; will be entitled to a credit of $1,039, in addition to the fixed credit of $10,385 and the variable credit.
Multi-year commitment credit: $10,385 x 10 % = $1,039
|
Company A
|
|
|---|---|
| Reduction goal | 155 kW |
| Duration of agreement | 1 year |
| Bonus | $0 |
|
Company B
|
|
|---|---|
| Reduction goal | 155 kW |
| Duration of agreement | 3 years |
| Bonus | $1,039 |
Hypothetical example
Variable credit
The variable credit is the incentive offered in exchange for the energy curtailed during peak demand events. It is added to the fixed credit and is calculated for each billing period.
This credit varies based on the maximum number of peak demand events included in the sub-option selected.
Maximum number of peak demand events per day
First peak demand event with overrun
$0.05/kWh
Second peak demand event with overrun
$0.35/kWh
Calculation of variable credit
Energy curtailed during the peak demand events that took place in the last billing period (kWh) × credit per kilowatthour ($/kWh) = amount of the variable credit ($)
No. An agreement cannot be modified before it expires, at the end of the winter period. The number of maximum peak demand events per day is based on the sub-option you selected. You can only change your sub-option when you renew your enrollment in the DR Commitment Option, should you choose to do so.
|
Company A
|
|
|---|---|
| Energy curtailed | 2,798 kWh |
| Peak demand events | Maximum of 1 per day |
| Variable credit | $140 |
|
Company B
|
|
|---|---|
| Energy curtailed | 2,798 kWh |
| Peak demand events | Maximum of 2 per day |
| Variable credit | $979 |
Hypothetical example
Short notice credit
- 70.000 ¢ per kilowatthour of effective hourly interruptible power for each peak demand event hour.
- If the customer who received a notice shorter than the one provided for does not provide the interruptible power to which they committed, Hydro‑Québec applies the relevant deductions (penalties).
Credit for a notice that is shorter than the one provided for, paid after each relevant consumption period and calculated as follows :
What happens if my company doesn't meet its power demand reduction goal?
If a company doesn't meet the agreed-upon reduction goal, or if it terminates an agreement before it expires, a charge is deducted from the applicable credit. However, this charge is capped.
Overrun deduction (penalty)
During a peak demand event, consumption is recorded every 15 minutes. If a company exceeds its maximum power demand threshold during the event, the overrun will count for 1 hour, and a charge will be deducted from the credit.
According to the applicable terms and conditions, the amount deducted cannot exceed the maximum deduction set for a peak demand event, and the sum of overrun deductions for a given winter period cannot exceed the cap determined for the season.
- No variable credit is granted for the hour during which the overrun occurs, meaning that any curtailment during that hour is not taken into account for calculating the variable credit.
- The rest of the peak demand event is not affected.
- The fixed credit is still granted.
- The amount of the charge—either the overrun deduction or the maximum deduction for a peak demand event, as applicable—will be deducted from the credit.
Overrun deduction calculation
- Sum of overruns (excess power demand) during a peak demand event (kW) × deduction per excess kilowatt ($/kW)
- Power demand reduction goal × maximum deduction per event ($/kW) x contribution coefficient for the consumption period in question
The lowest of the two amounts applies.
The penalties for peak demand events are added together until the maximum penalty amount per peak demand event is reached. The penalty per event is deducted from the fixed credit, which is still applied to the customer's bill.
A maximum penalty for the season is also provided for. This corresponds to 150% of the fixed credit. This maximum penalty is also applied in the event of early withdrawal from a multi-year agreement.
Early termination deduction
If a company decides to terminate their multi-year commitment before it expires, Hydro‑Québec deducts an amount equal to 50 % of the credits calculated for the year of termination, multiplied by the number of years remaining in the commitment.
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Distributed over 4 or 5 peak demand events.
Distributed over 8 to 10 peak demand events.
Distributed over 12 to 15 peak demand events.
Distributed over 16 to 20 peak demand events.
Distributed over 20 to 25 peak demand events.