What is the Rate of Last Resort?
On January 1, 2025, the Regulated Rate Option (RRO) was replaced with the Rate of Last Resort which is a fixed rate product set every two years. The Rate of Last Resort (RoLR) is now the default electricity rate for Albertans who have not chosen, or are not currently with, a competitive energy retailer.
The price of Alberta's Rate of Last Resort which has been approved by the Alberta Utilities Commission (AUC), will vary across different areas of the province. If Direct Energy Regulated Services is the default energy provider in your area, our Rate of Last Resort will be 12.02 cents/kWh from January 1, 2025, to December 31, 2026.
Why has the Regulated Rate Option (RRO) changed to the Rate of Last Resort (RoLR)?
The Government of Alberta believes this new name provides a more accurate description of the default electricity rate, encouraging Albertans to explore their other options, such as switching to a fixed-rate plan.
How is the Rate of Last Resort different from the RRO?
Unlike the RRO which is a monthly fluctuating rate that adjusts based on the market, the Rate of Last Resort is set every two years to avoid sudden spikes in pricing for customers. The Rate of Last Resort is a fixed rate from January 1, 2025, until December 31, 2026, and can only go up or down by a maximum of 10% at the end of each 2-year term.
Who is eligible for the Rate of Last Resort (RoLR)?
Customers who consume less than 250,000 kWh annually are eligible for the Rate of Last Resort. For example, an average household uses approximately 7,600 kWh per year. So, if you haven't chosen a competitive electricity retailer and consume less than 250,000 kWh per year, then you are automatically a Rate of Last Resort customer.
What is the difference between the Rate of Last Resort fixed rate and a competitive fixed rate plan?
As of January 1, 2025, Alberta’s Regulated Rate Option (RRO) has transitioned to the Rate of Last Resort (RoLR) as the default electricity rate for customers who have not chosen, or are not currently with, a competitive retailer. Unlike the RRO, the RoLR is a fixed rate set every two years.
Here’s how the Rate of Last Resort fixed rate compares to competitive fixed rate plans:
- Rate determination: The RoLR fixed rate is a regulated fixed rate that is set every two years and approved by the Alberta Utilities Commission (AUC). The RoLR can only go up or down by a maximum of 10% at the end of each 2-year term. Whereas, competitive fixed rate plans are determined by individual retailers based on market conditions and business strategies, offering various term lengths and rates.
- Flexibility and choice: The RoLR fixed rate is automatically applied to customers without a competitive contract and doesn’t have any customization options. With a competitive fixed rate plan, you can select different term lengths, rates and additional features like green energy options as well as benefit from incentives and promotions.
- Pricing stability: While both rates provide price stability, competitive fixed rate plans allow you to select a term length that fits your preferences.
- Additional fees: The RoLR fixed rate includes a 0.1¢ per kWh surcharge for consumer awareness, which goes directly to the Utilities Consumer Advocate (UCA).
Are there any additional fees with the Rate of Last Resort?
Yes, there is a small 0.1¢ per kWh surcharge for consumer awareness, which goes directly to the Utilities Consumer Advocate (UCA). This fee helps keep you informed about your electricity choices. To support this, the UCA will get basic contact information for RoLR customers every two months to share updates. Aside from this, regular fees and charges will still apply.
How do I know if I’m on the Rate of Last Resort?
Check your electricity bill and if you’re receiving your electricity charges from Direct Energy Regulated Services, EPCOR Rate of Last Resort or ENMAX Rate of Last Resort, then you are on the Rate of Last Resort.
Was I automatically switched from the RRO to the Rate of Last Resort (RoLR)?
If you were on the RRO and took no action, you have been automatically switched to the RoLR on January 1, 2025.
I’m on the Rate of Last Resort. Do I have other options?
Yes, we’ve got you covered! We offer fixed-rate plans with no exit fees, a combined bill and other promotions. All you need to do is sign up for a fixed-rate plan online or give us a call at 1-855-452-8869.
Customers are free to purchase natural gas services or electricity services from a retailer of their choice. For a list of retailers, visit ucahelps.alberta.ca or call 310-4822 (toll free in Alberta).
Is the Rate of Last Resort for both electricity and gas?
No, the Rate of Last Resort is only for regulated electricity, so regulated natural gas isn’t affected by these regulation changes.
While both the regulated natural gas rate and Rate of Last Resort are reviewed and approved by the Alberta Utilities Commission, gas and electricity prices are impacted by different market factors and are set independently. That's why we've noticed lower natural gas prices compared to higher electricity rates in the past two years. Learn more about the benefits of regulated natural gas.
Will my regulated natural gas rate be affected?
If you are on our regulated natural gas rate, you can sit back and relax knowing that you are enjoying the lowest* natural gas rate in Alberta. Plus, our regulated natural gas rate is forecasted to continue remaining lower** than fixed-rate plans in 2025!
