Hydro-Québec has started to tighten the screws on customers of its Hilo subsidiary who take undue advantage of the system to maximize the cash rewards they receive.
With the cold spell in full swing, the state-owned company has just sent a warning to customers suspected of cheating on their electricity consumption and warns them that their rewards could be reduced at the end of the season.
“Analysis of your consumption data leads us to believe that you may have manipulated the calculation of your baseline consumption by consuming more before the Hilo challenges, in order to maximize your rewards during the challenges,” says the message from Hydro- Quebec.
In exchange for financial assistance that largely covers the purchase and installation of smart thermostats, Hilo customers agree to take on the challenges of shifting their electricity consumption during periods of high demand to relieve the network.
They receive cash back for each kilowatt hour moved during these periods. The difference between the customer’s normal consumption and the consumption cleared during the critical period is used to calculate the cash back.
However, by heating excessively during the period preceding the challenges, even if it means opening the windows, then by turning everything off during the restriction period, users have managed to receive incredible discounts. Many even bragged about their extraordinary results on social media.
Hilo customers received an average of $140 in rebates for the entire season last winter, which included 19 challenges, while some received more than that amount for each challenge.
The state company reacts
The cash back rewards more than offset the cost of additional consumption by customers targeted by the warning, which forced Hydro-Québec to react.
“The objective of the Hilo challenges is to reduce its consumption compared to its usual consumption,” says the message from Hydro-Québec, which recalls that the agreement signed by the participants “specifies that it is not necessary to rig electricity consumption under the program.
“We therefore reserve the right to adjust your rewards at the end of the season if we see that this trend continues,” warns the company.
Those who received this first warning displayed behavior “which did not occur only once and does not appear accidental,” said Hydro-Québec spokesperson Cendrix Bouchard.
According to him, these are “exceptional cases”, or around a hundred customers out of the 30,000 in Hilo. “We encourage responsible consumption of electricity and not willful manipulation of consumption in order to maximize rewards during challenges,” he said.
Rewards could be capped if abusive behavior continues, he said.
Difficult beginnings
Hilo, now in its fourth winter season, has had a rocky start. First created as an independent subsidiary, the organization was repatriated to Hydro-Québec after the departure of its CEO and that of its head of technology.
Last year, its 22,000 participants relieved the electricity network by an average of 62.5 megawatts during each of the 19 cold episodes for which they were called upon. This is the equivalent of the consumption of 9,000 residences which has been erased.
This year, the number of participants increased to more than 30,000.
Hilo is one of the peak management tools that is expensive for Hydro-Québec, which partly subsidizes the necessary equipment and which pays for the installation of thermostats by an electrician.
According to the state-owned company, Hilo should not be seen just as a profit center, but as a virtual power plant, which allows the electricity distribution network to be managed more efficiently, which translates into savings.
With this virtual power plant, the state-owned company expects to be able to displace 600 megawatts of peak demand by 2025, or 10 times the results obtained last year.