Time of Use Rates Explained

Описание: With standard electricity rate plans, you pay the same rate for electricity whether you turn your lights on in the morning, afternoon or evening. Time-of-use, or TOU, electricity rate plans are a bit different: the rate you pay for electricity varies depending on the time of day you use it.

On TOU plans, you pay more for electricity during “peak” hours: these are the hours of the day when electricity demand is higher, like in the evenings when people return home from work. To balance for these higher electricity prices, you pay less for electricity during “off-peak” hours, such as late at night when people are sleeping and overall demand for electricity is lower.

TOU rates won’t necessarily lead to higher electricity bills. In fact, you can save money on your monthly electricity bills by adjusting your daily electricity consumption habits, such as running your dishwasher in the morning instead of right after dinner, or by charging your electric vehicle overnight.

If you’re considering going solar, keep in mind that the economics of solar change under a TOU plan. Since your credits for excess solar electricity sent to the grid vary depending on the time of day, a net metering credit generated during off-peak hours will be worth less than a credit sent to the grid during peak hours.

Many solar homeowners with TOU rates consider pairing their system with a solar battery. This allows you to use stored power during peak hours, rather than paying for expensive electricity from the grid.