What is Critical Peak Pricing (CPP) and how will it affect me? Millions of consumers are asking themselves the very same questions. We get that it can be quite confusing, so we will try to provide you with a better understanding as to how you will be affected by CPP changes.
What is Critical Peak Pricing (CPP)?
Critical Peak Pricing or CPP is the period in which utility companies anticipate or observe either emergency conditions to the power system or higher wholesale market rates.
For example, the energy company may declare a “critical event” during a specific time of the day such as 2 p.m. to 7 p.m during the hottest days of the summer. In this time frame, the rates for power usage are obviously substantially higher.
There are two variants for CPP rates. These include when the time and duration of the event may increase based on the need of the power grid to reduce loads. The second is occurs when the time and duration of the CPP has been predetermined.
How This Will Affect You
Pending approval of the CPUC in March of this year, the majority of small to medium sized businesses, large pumping business and large farming organizations were automatically enrolled in CPP rates. The CPP plan has been set as the default plan for large businesses and corporations with Rate Schedules TOU-GS-3 and TOU-8.
Critical Point Pricing will provide a price increase for 12 CPP event days in each calendar year between the hours of 4 p.m. and 9 p.m in exchange for discount rates for the summer for the days when the temperatures are the highest.
In order to avoid paying significantly higher CPP, you can reduce your energy usage on those days which have been declared as CPP event days. You should have been given a chance to opt out of the CPP plan in March of this year before the transition to the plan officially took place.
Ways to Lower Energy Costs During These Events
- Increase your air conditioner setting to 78 °F.
- Turn off all non-essential equipment and the like when not in use.
- Only charge smartphones, laptops, tablets and the like during non CPP hours.
- Unplug ice and vending machines during the CPP event.
Those who have signed up to receive notifications will notified a day before a scheduled CPP event.
You can avoid CPP by going solar and realize some great savings in the meantime.