What Time-of-Use Electricity Rates Are

Why the clock changes the price

Electric systems must match supply and demand every moment. Demand often rises in the late afternoon and early evening, when people return home and businesses are still operating. A time-of-use rate gives customers a reason to move flexible use away from those expensive hours.

The price periods are set by a tariff, not by a live wholesale market. Most residential plans repeat a fixed weekday and weekend schedule for a season. A few plans add critical peak events or dynamic prices.

How to read a schedule

Start with the season, then check whether the day is a weekday, weekend, or holiday. Read the hour when each period begins and ends. A window listed as 4 PM to 9 PM normally includes energy used from 4:00 PM through 8:59 PM.

Next compare cents per kilowatt-hour, not only labels such as off-peak. Riders, adjustments, baseline allowances, minimum bills, and fixed customer charges may still affect the final bill.

What can move

EV charging, dishwashing, laundry, water heating, battery charging, and some heating or cooling can often move by a few hours. Refrigeration, lighting, cooking, and medical equipment are less flexible.

A TOU plan is most useful when the household can automate the shift. Vehicle schedules, smart thermostats, appliance delays, and battery controls reduce the need to watch the clock every day.

Before changing plans

Compare a full year rather than one summer month. Check eligibility, fixed charges, demand charges, export credits, and whether the utility offers bill protection. Confirm every number against the current utility tariff because public rate databases are reviewed periodically rather than continuously.