After a chaotic year for Hilo, marked by the dismissal of its CEO and the departure of its head of technology, the Hydro-Québec subsidiary created to manage the winter peak is performing better than expected.
Hilo’s 22,000 customers helped Hydro-Québec relieve its network of an average of 62.5 megawatts during each of the 19 cold spells for which they were called upon. This is the equivalent of the consumption of 9,000 residences that has been erased during these periods when the electricity network is most in demand.
The results for the 2022-2023 winter, the third in Hilo’s short history, exceeded the 47 megawatt objective set by Hydro-Québec by 33%. According to its spokesperson, Cendrix Bouchard, this result is explained by the expansion of Hilo’s offer to business customers and by the addition of new functionalities, such as the charging of electric vehicles, to reduce the electricity consumption during critical hours.
Hilo customers also had a new option, the extreme challenge, which was added this year to the moderate and bold challenges and which offers the possibility of reducing their electricity consumption even further.
The 22,000 Hilo customers who reduced their electricity consumption to meet the needs of the power grid shared average rewards of $140.
The average of the rewards paid by Hilo to its customers covers a very broad reality. Many of them who completed all the challenges offered, 19 in total between December 1 and March 31, were able to receive many more.
Some of them have also circumvented Hilo’s terms of use to optimize their cash rewards, which inflates the average compensation paid.
As the rewards are calculated according to the difference between the consumption of a household and the reduction in consumption during the period of the challenges, it was enough, for example, to heat to the maximum, even if it meant opening the windows, before the start of the restricted period and cut everything during the restricted period to get the most money.
Hydro-Quebec could crack down on these Hilo customers, said the spokesperson for the Crown corporation, which assures that a very small number of users “tried to maximize the rewards”. According to Cendrix Bouchard, although they are not breaking any law by doing so, these users are going against the energy efficiency objectives that are the raison d’être of Hilo and which are specified in the terms of service. use of the service.
“Hilo has the option to end the deal,” he said. So far, none of these cheaters have been punished.
The other state-of-the-art demand management tool aimed at the general public, dynamic pricing, has been much more successful than Hilo this winter. The two dynamic pricing options, Winter Credit and Rate Flex D, appealed to 228,000 Hydro-Québec customers. Their combined efforts made it possible to shift 206 megawatts of consumption during critical periods.
The vast majority of dynamic pricing users, 202,000 out of 228,000, chose winter credit. This option provides a credit of 53.5 cents for each kilowatt hour of reduction in usual consumption during critical periods for the electricity network announced the day before.
The average savings achieved by subscribers to the winter credit varies between $27 and $71.40, depending on the involvement of consumers, indicates Hydro-Québec. Some were able to save a lot more, as reported by one La Presse reader, who reduced his heating bill by $265.57 with the help of smart thermostats.
The other dynamic pricing option, the Flex D fare, is less popular. It offers the possibility of paying less than the ordinary tariff throughout the winter period, but of paying a much higher price per kilowatt-hour during peak periods, which encourages reducing electricity consumption.
In total, the 228,000 users of dynamic pricing relieved the electricity grid of 206 megawatts. This is equivalent to the demand of 29,400 households.
These new advanced demand management tools are expensive for Hydro-Québec. Especially Hilo, which partially subsidizes the necessary equipment and pays for the installation of the thermostats by an electrician.
The state-owned company has other means of managing the winter peak, such as the possibility of disconnecting certain large companies in exchange for financial compensation, the purchase of electricity on neighboring markets during critical hours or the use of its emergency natural gas power plant located in Bécancour.
By comparison, the 3,400 companies enrolled in the interruptible energy program can move 425 megawatts of peak power. It was not possible to obtain a basis for comparing the costs of the different means available.
According to the Crown corporation, Hilo should not be seen only as a profit center, but as a virtual power plant that allows the electricity distribution network to be managed more efficiently, which translates into savings.
The Hilo subsidiary is being restructured by Hydro-Québec in order to increase its efficiency. Already, Hilo’s offer for future customers is less generous than when it started three years ago.
“Hilo’s offer will continue to evolve,” says Cendrix Bouchard, and the benefits for Hydro-Quebec will increase, he says. With its virtual power plant, the state-owned company will be able to displace 620 megawatts of peak demand within five years, a 10-fold increase in this year’s results.
