As more businesses look for ways to adopt green energy and generate their own electricity, a new proposal by Nunavut's main electricity provider, Qulliq Energy Corporation (QEC), has sparked a vital discussion. QEC has put forward a plan to introduce a standby power rate, a special charge for businesses that produce their own power but still rely on QEC’s grid as a backup in case their systems go offline. This article explains the proposal in detail, why it matters, and what it could mean for the future of power in Nunavut.

Understanding the Basics: What is Standby Power?

Standby power is electricity supplied by a utility as a backup when a customer’s own generation systems are not running. For businesses that generate their own power—often through renewable sources like solar panels or small generators—the connection to the main grid is a safety net. When weather, maintenance, or unexpected problems cause their own systems to fail, they switch to power from the main grid to keep their operations running smoothly.

The new proposed standby power rate is a fee that businesses who rely on QEC’s grid for such backup would have to pay. This charge is different from the usual electricity rates because it reflects the cost of maintaining the infrastructure and readiness to supply power, even if the business only uses it occasionally.

Why is QEC Proposing This New Rate?

QEC operates the power grid in Nunavut, powering 25 communities primarily through diesel generators. It has to maintain a strong and reliable infrastructure capable of meeting peak demands, including those times when businesses need emergency backup power. This means QEC must keep systems ready even if some customers generate most or all of their own power.

The new standby rate, proposed at 48 cents per kilowatt (kW) per hour, aims to recover the cost of this readiness. It ensures that these self-generating businesses also contribute fairly to the grid’s upkeep, so regular customers aren’t subsidizing the cost for those who rely less on the utility’s power.

Ernest Douglas, QEC’s president and CEO, explained that the proposal creates fairness. He said it allows customers who want to generate 100% of their electricity themselves but still use QEC as a backup to pay for the cost of that backup service. This way, the financial burden is shared based on the level of service actually used, preventing higher bills for everyday users.

How Does the Proposed Standby Rate Compare?

Currently, residential customers pay about 75 cents per kilowatt-hour, and businesses pay about 62 cents per kilowatt-hour for electricity. The new standby rate of 48 cents per kW per hour specifically targets the demand charge component — effectively a fee for the availability of power capacity on standby.

This rate is designed after reviewing how other Canadian jurisdictions handle standby rates, including the Northwest Territories, which has already had a standby charge since 2024.

The Details of the Proposal
The standby rate application submitted by QEC also includes:

• A monthly demand charge of $48 per kilowatt applied to the customer's nominated standby load.
• Charges when the customer is not connected to the QEC grid but uses the standby service.
• Normal energy and demand charges apply when the customer is connected to the grid in usual ways.
• A connection/disconnection fee calculated based on the actual cost for providing standby service.
• Revised terms and conditions to govern the standby service.

This proposal is currently under review by Nunavut’s Utility Rates Review Council (URRC), which seeks public input before making recommendations to the government minister responsible for QEC. The deadline for feedback is September 8, 2025.

What Does This Mean for Off-Grid Businesses?
The introduction of the standby power rate has important implications:

• For businesses generating their own power through solar panels, wind turbines, or other sources, it defines a clear cost for backup service.
• It helps QEC cover costs to maintain a reliable grid even as more customers move towards self-generation.
• It encourages a fair pricing structure so that costs are not unfairly shifted to customers who do not generate their own electricity.
• It signals a transition as Nunavut balances traditional diesel-powered grids with growing renewable energy use.

Klaus Dohring, president of Green Sun Rising, a company installing solar systems in remote Nunavut communities, welcomes renewable energy growth but notes challenges. He says the territory’s utility has set strict limits on solar generation, which can slow adoption. He suggests that better rates paid to independent producers would help encourage locally produced clean power—an issue the standby rate debate highlights.

Challenges and Criticisms

• While offering fairness, the standby rate proposal may also raise concerns:
• Some fear added costs might discourage businesses from investing in green technologies and self-generation.
• The connection/disconnection fees and standby charges add new financial layers.
• Small businesses might find these fees burdensome, especially if they rely on uncertain backup power use.
• Questions remain on how standby loads will be measured and billed fairly.

QEC counters that the standby rate won’t affect regular customers or those who rely fully on the grid. It provides a reasonable way to prevent a small group from creating higher system costs borne by everyone else.

The Bigger Picture: Moving Towards Energy Sustainability

This proposal reflects broader energy challenges in Nunavut and other remote regions. As renewable and independent power sources increase, utilities must rethink rate designs and infrastructure funding. Standby power rates are part of this evolution, helping ensure utilities can maintain reliable service while supporting cleaner energy.

For Nunavut’s communities, which face high energy costs, diesel dependency, and geographical challenges, balancing innovation and reliability is crucial. New policies like this aim to create a fair and sustainable path forward.

What Can Nunavut Residents Do?

The public consultation process means everyone can have a voice. Businesses, residents, and stakeholders are encouraged to review the proposal and submit comments to the Utility Rates Review Council by September 8, 2025.

Such engagement helps shape policies that balance economic fairness, energy transition, and grid sustainability.