Ontario Electricity Ultimate Guide
Everything Ontario residents need to understand how electricity pricing works — and how to reduce their bill.
Updated 2026-02-12
1. How Ontario’s electricity system is structured
Ontario electricity involves multiple layers working together:
- Generation: Nuclear, hydro, wind, gas, and other sources produce electricity.
- Transmission: High-voltage lines move electricity across the province.
- Distribution: Your local utility delivers power to homes and businesses.
- Regulation: Provincial rules and market systems govern pricing and operations.
Understanding these layers helps explain why your bill includes more than just energy charges.
2. How your electricity bill is built
Most residential electricity bills in Ontario include:
- Energy charge (based on kWh used)
- Delivery charges
- Global Adjustment and other riders
- HST
If you want a step-by-step breakdown of each line item, see How Ontario Electricity Billing Works.
3. TOU vs Tiered vs ULO explained
Ontario households can choose between different pricing structures:
Quick Comparison
| Plan | How it works | Best for | Watch out for |
|---|---|---|---|
| TOU | Price changes depending on time of day (on-peak, mid-peak, off-peak). | Households that can shift flexible loads to off-peak. | Heavy daytime use can raise costs. |
| Tiered | Lower rate up to a monthly threshold, higher rate above it. | Predictable, moderate usage. | High usage months move more kWh into higher tier. |
| ULO | Includes a very low overnight rate period. | EV charging or meaningful overnight usage. | If overnight use is low, savings disappear. |
Time-of-Use (TOU)
Rates change depending on time of day. Using electricity during off-peak periods lowers your cost. See TOU vs Tiered pricing explained.
Tiered
You pay one rate up to a usage threshold, then a higher rate above that threshold.
Ultra-Low Overnight (ULO)
ULO introduces a deeply discounted overnight rate. This can benefit EV owners or households able to shift usage overnight.
You can compare these plans using our:
4. Why your bill changes
Electricity bills vary month to month because of:
- Seasonal heating or air conditioning
- Rate updates
- Changes in delivery charges
- Weather-driven demand shifts
If your bill jumped unexpectedly, see Why Your Bill Changed.
5. What actually lowers your bill
There are two primary levers:
- Use fewer kWh overall
- Shift flexible usage to cheaper periods
Practical actions
- Run dishwasher and laundry during off-peak or overnight hours
- Charge EVs overnight (ULO/TOU)
- Reduce standby loads
- Use programmable thermostats
- Upgrade lighting to LED where high usage hours justify it
Frequently Asked Questions
Which plan is cheapest in Ontario?
It depends on how much electricity you use and when you use it. Households that can shift usage to off-peak hours often benefit under TOU or ULO. Tiered works well for steady, predictable usage.
Why are delivery charges so high?
Delivery covers the cost of transmission lines, distribution infrastructure, and maintaining the local grid. These costs apply regardless of which pricing plan you choose.
What is the Global Adjustment?
The Global Adjustment helps recover certain system and contracted generation costs. It can change over time and affects total monthly bills.
Are these calculators exact?
No. They are educational estimators. Real bills include changing rates, local delivery structures, and regulatory adjustments.
Educational resource only. Electricity pricing structures and definitions change over time. For official rates and plan details, consult your utility provider and provincial regulator materials.