Ontario's three electricity plans charge very different rates — and the plan you choose can mean a 7-year payback vs a 13-year payback on solar + battery
After the 30% rate increase in November 2025, TOU on-peak is 20.3¢/kWh, Tiered is 10.3¢/12.5¢/kWh, and ULO ranges from 3.9¢ overnight to 39.1¢ on-peak. With solar + battery, ULO's 35.2¢/kWh spread generates $1,000–$1,500/year more savings than TOU.
How Ontario Electricity Pricing Works
Every Ontario electricity bill has the same four components, regardless of which pricing plan you choose:
Your pricing plan only affects the electricity charge. For a typical household using 700–900 kWh/month, the electricity charge represents roughly 35–45% of the total bill. The rest is delivery, regulatory, OER, and HST.
Plan 1: Time-of-Use (TOU)
TOU is the default plan for most Ontario households. It charges different rates depending on the time of day, with the goal of encouraging usage during off-peak hours when grid demand is lower.
Current TOU Rates (November 1, 2025 – April 30, 2026)
| Period | Rate (¢/kWh) | Weekday Hours (Winter) |
|---|---|---|
| On-Peak | 20.3¢ | 7–11 AM + 5–7 PM |
| Mid-Peak | 15.7¢ | 11 AM – 5 PM |
| Off-Peak | 9.8¢ | 7 PM – 7 AM |
Weekends and statutory holidays are off-peak all day (9.8¢/kWh).
Summer TOU Hours (May 1 – October 31)
In summer, the peak and mid-peak windows swap:
| Period | Rate (¢/kWh) | Weekday Hours (Summer) |
|---|---|---|
| On-Peak | 20.3¢* | 11 AM – 5 PM |
| Mid-Peak | 15.7¢* | 7–11 AM + 5–7 PM |
| Off-Peak | 9.8¢* | 7 PM – 7 AM |
*Summer 2026 rates will be set by the OEB and may differ. The rates shown are current winter rates for comparison. The next scheduled rate adjustment is May 1, 2026.
Best for
Households that can shift laundry, dishwashing, and EV charging to off-peak hours (before 7 AM or after 7 PM). Most Ontario homes default to TOU and it works reasonably well if you're disciplined about timing.
Watch out
The 20.3¢ on-peak rate is where the pain is. Cooking dinner, running the AC when you get home from work, and charging your EV in the early evening all happen at the most expensive rate.
Plan 2: Tiered Pricing
Tiered pricing charges a flat rate per kWh regardless of when you use it, but the rate increases once you cross a monthly threshold. It's simpler than TOU — no need to think about timing.
Current Tiered Rates
| Tier | Rate (¢/kWh) | Threshold |
|---|---|---|
| Tier 1 (lower) | 10.3¢ | First 1,000 kWh/month (winter) |
| Tier 2 (higher) | 12.5¢ | Everything above threshold |
The threshold changes by season: 1,000 kWh/month in winter (November–April) and 600 kWh/month in summer (May–October). The lower summer threshold means you hit Tier 2 faster during air conditioning season.
Best for
Households with consistent low-to-moderate consumption (under 750 kWh/month). If you use less than the Tier 1 threshold, every kWh costs 10.3¢ regardless of timing — cheaper than TOU's blended average for most usage patterns.
Watch out
Heavy users pay 12.5¢ on everything above the threshold. If you have electric heating, an EV, or a hot tub, Tiered pricing can get expensive. And unlike TOU, there's no way to get a lower rate by shifting your usage.
Plan 3: Ultra-Low Overnight (ULO)
ULO is the newest plan, launched by the Ontario government specifically for households with electric vehicles, battery storage, or other loads that can be shifted to overnight hours. It offers the cheapest rate in Ontario — and the most expensive.
Current ULO Rates (Year-Round)
| Period | Rate (¢/kWh) | Weekday Hours | Weekend/Holiday |
|---|---|---|---|
| Ultra-Low Overnight | 3.9¢ | 11 PM – 7 AM | 11 PM – 7 AM |
| Weekend Off-Peak | 7.6¢ | — | 7 AM – 11 PM |
| Mid-Peak | 12.2¢ | 7 AM–4 PM + 9–11 PM | — |
| On-Peak | 39.1¢ | 4 PM – 9 PM | — |
The ULO on-peak rate (39.1¢/kWh) is nearly double the TOU on-peak rate (20.3¢). Without solar or battery storage to cover the 4–9 PM window, ULO will likely increase your bill.
The key to ULO: the overnight rate (3.9¢/kWh) is 60% cheaper than TOU's off-peak rate (9.8¢) and 62% cheaper than Tiered Tier 1 (10.3¢). If you can shift the majority of your consumption to 11 PM–7 AM, the savings are substantial. But any weekday consumption between 4–9 PM without solar or battery coverage gets punished at 39.1¢.
Best for
Homeowners with solar panels + battery storage. The battery charges overnight at 3.9¢ and discharges during the 4–9 PM peak at 39.1¢ — a 35.2¢/kWh profit per cycle. Also strong for EV owners who charge exclusively overnight and have low daytime consumption.
Watch out
If you're home during weekday evenings without solar or battery, the 39.1¢ rate will erase any overnight savings. The Ontario government estimates ULO saves typical households about $90/year — but that assumes no solar or battery. With battery storage, the savings are $1,000+/year more than TOU.
Side-by-Side: All Three Plans Compared
| Feature | TOU | Tiered | ULO |
|---|---|---|---|
| Cheapest rate | 9.8¢ off-peak | 10.3¢ Tier 1 | 3.9¢ overnight |
| Most expensive rate | 20.3¢ on-peak | 12.5¢ Tier 2 | 39.1¢ on-peak |
| Rate spread | 10.5¢ | 2.2¢ | 35.2¢ |
| Weekend rate | 9.8¢ all day | 10.3¢ Tier 1 | 7.6¢ all day |
| Billing complexity | Moderate | Simple | Complex |
| Best without solar | Most households | Low users (<750 kWh) | Night-shift workers only |
| Best with solar+battery | Good | Moderate | Best (highest ROI) |
Which Plan Should You Choose?
The answer depends on two things: your consumption pattern and whether you have (or plan to get) solar and battery storage.
If you don't have solar or battery
TOU is the best option for most Ontario households. You'll pay 9.8¢/kWh during evenings and weekends, which is where most residential consumption naturally falls. The on-peak rate (20.3¢) only applies during morning and early evening weekday hours. Tiered is better only if your total monthly usage stays below the threshold consistently.
If you have solar panels (no battery)
TOU still works well. Your solar production covers midday consumption (mid-peak on TOU), and net metering credits offset grid usage at the same rate you'd pay. Tiered can also work since solar reduces your grid consumption, keeping you in Tier 1 more often.
If you have solar + battery storage
ULO is almost always the best choice. The 35.2¢/kWh spread between overnight charging (3.9¢) and peak discharge (39.1¢) generates $1,000–$1,500/year more in savings than TOU. Your solar covers daytime consumption, and the battery handles the 4–9 PM peak window.
With AI-optimized battery management, the system automatically charges from the grid overnight at 3.9¢, uses solar production during the day, and discharges the battery during the 4–9 PM peak when rates hit 39.1¢. No manual intervention required.
How to Switch Plans
Switching between TOU, Tiered, and ULO is free and can be done through your local utility:
Plan changes take effect at the start of the next billing period. You can switch once per billing cycle. There is no penalty for switching, and you can always switch back if the new plan doesn't work for your consumption pattern.
The 30% Rate Increase: What Happened and What's Next
On November 1, 2025, the Ontario Energy Board implemented the largest residential rate increase since 2019. All three rate plans increased roughly 29–30%. The Ontario government partially offset this by increasing the Ontario Electricity Rebate from 13.1% to 23.5%, which reduces the net impact to about 15–18% for most households.
Despite the OER increase, the typical Ontario household using 700 kWh/month now pays roughly $15–$25 more per month than before November 2025. For higher-consumption homes (1,000+ kWh), the increase is $25–$40/month.
The next scheduled rate adjustment is May 1, 2026 for summer rates. No major changes have been announced, but the OEB sets rates based on projected supply costs — and Ontario's generation mix is shifting as nuclear refurbishments continue and natural gas costs remain elevated.
Every month without solar means full exposure to rate increases. Ontario electricity rates have increased by more than 30% since 2019. Solar + battery locks in your energy cost and protects against future hikes. Read more about the rate shock.
Frequently Asked Questions
Do delivery charges change with my rate plan?
No. Delivery charges are set by your local utility and are the same regardless of whether you’re on TOU, Tiered, or ULO. They’re based on the amount of electricity delivered, not when you use it.
Is the Ontario Electricity Rebate (23.5%) permanent?
The OER is set by the provincial government and can change at any time. It was increased from 13.1% to 23.5% in November 2025 alongside the rate increase. There is no guarantee it will remain at this level, and it could be reduced if the government changes its approach to electricity subsidies.
Can I switch to ULO without solar or battery?
Yes. ULO is available to all residential customers. However, without solar or battery to cover the 4–9 PM weekday peak (39.1¢/kWh), most households will pay more on ULO than on TOU. The plan is designed for customers who can genuinely shift consumption to overnight hours.
What are the actual hours for each plan in summer vs winter?
TOU changes its on-peak and mid-peak windows between summer and winter (the hours swap). ULO hours stay the same year-round. Tiered has no time component — only a monthly volume threshold that changes between seasons (1,000 kWh winter, 600 kWh summer).
How much can I save by switching plans?
For typical households without solar: switching from TOU to Tiered saves $0–$120/year depending on consumption. Switching to ULO without solar saves roughly $90/year per the Ontario government’s estimate. With solar + battery, switching from TOU to ULO saves an additional $1,000–$1,500/year due to the 35.2¢/kWh arbitrage spread.
Find Out Which Plan Saves You the Most
Your optimal rate plan depends on your consumption pattern, whether you have solar or battery, and how much flexibility you have to shift usage. The difference between plans can be $1,500+/year for households with solar + battery.
Book a free consultation with Solar X — we'll analyze your current bill, model the impact of solar and battery on each rate plan, and show you which combination maximizes your return.