Time-of-Use Rates: Why *When* You Use Watts Matters
Avoid high on-peak electrical bills. Shift appliance run times to off-peak slots.
The Shift in Utility Pricing
For decades, electricity was billed at a flat rate. A kilowatt-hour (kWh) cost the same whether you used it at 3:00 AM or 3:00 PM. But as the electrical grid faces higher demands and integrates renewable energy, utility companies are aggressively transitioning to Time-of-Use (TOU) pricing.
Under a TOU plan, the cost of a kWh fluctuates depending on the time of day, the day of the week, and the season. Electricity is cheap when demand is low (off-peak) and very expensive when demand is high (on-peak).
Understanding the timing of your wattage usage is now just as important as reducing the total watts you use.
Navigating Peak vs Off-Peak Hours
While specific times vary by utility, a typical summer TOU schedule looks like this:
- Off-Peak (Cheapest): Midnight to 2:00 PM. (Rate: ~12¢/kWh)
- Partial-Peak (Moderate): 2:00 PM to 4:00 PM, and 9:00 PM to Midnight. (Rate: ~20¢/kWh)
- On-Peak (Most Expensive): 4:00 PM to 9:00 PM. (Rate: ~35¢ to 50¢+/kWh)
Strategies to Master TOU Rates
You don't need to sit in the dark during peak hours, but you do need to shift high-wattage loads away from the expensive window.
| Appliance | TOU Strategy |
|---|---|
| EV Charger | Set a schedule in the car's app to only charge after midnight. |
| Dishwasher | Use the "Delay Start" button to run the cycle at 1:00 AM. |
| Air Conditioner | Pre-cool the house to 68°F during off-peak hours, then raise the thermostat to 76°F during peak hours. |
| Pool Pump | Adjust mechanical timers so the pump runs in the early morning instead of the afternoon. |
| Laundry | Save heavy washing and drying for weekend mornings (which are often considered off-peak all day). |
Frequently Asked Questions
1. Are Time-of-Use rates mandatory?
In many states (like California), TOU rates are now the default for new customers. Some utilities allow you to opt-out into a flat tiered rate, but you have to specifically request it.
2. Do weekends have peak hours?
Under most TOU plans, weekends and major holidays are considered off-peak all day, making them the perfect time to do laundry.
3. How do solar panels interact with TOU?
Solar is highly beneficial under TOU. If you produce solar energy during peak late-afternoon hours and send it to the grid, you get credited at the expensive peak rate!