What Are The Off-Peak And Peak Electricity Hours?

If you're thinking about shifting to a time-of-use (TOU) electricity plan, it's crucial to have a clear understanding of your utility's peak and off-peak hours. These plans determine the rate per kilowatt-hour based on the time of day you consume electricity. Gaining a thorough understanding of this concept allows you to assess the suitability of such a plan for your needs and strategize how to optimize it for potential savings on your energy bills.

Utility providers frequently implement Time-Of-Use (TOU) rates as a mechanism to adjust pricing during periods of heightened electricity demand, commonly referred to as peak hours. This practice helps alleviate stress on the power grid and encourages consumers to shift energy usage to periods of lower demand, known as off-peak hours, where electricity costs are more economical. By grasping the dynamics of peak and off-peak hours and leveraging TOU rates, you can economize on energy expenses by adjusting the timing of your electricity consumption at home.

Peak hours typically occur during weekday evenings when electricity demand peaks, while off-peak hours are typically observed during nighttime and midday when electricity demand is relatively subdued. Under TOU plans, electricity is priced higher during peak hours and lower during off-peak hours.

Embracing a TOU plan offers the opportunity to cut costs by curbing electricity usage during peak periods and redistributing more consumption to off-peak hours. The integration of solar panels and batteries proves advantageous by generating surplus energy during daylight hours, which can be stored for subsequent use during the evening.

Let's delve deeper into the intricacies of peak and off-peak electricity hours and explore how TOU plans can be strategically employed for potential cost savings.

What constitutes peak electricity hours?

Peak electricity hours point to particular times of the day when energy usage reaches its highest point. The precise hours defining these peak periods aren't universally fixed; they can vary depending on your location and the season.

These peak electricity hours also align with the highest electricity expenses. During this period, consumers face what is often referred to as 'peak pricing.' Peak pricing involves an extra fee applied to customers when demand is at its peak.

The extra cost associated with using electricity during peak hours depends on your utility provider and the specific rate plan you've selected.

Timing: Identifying Peak Electricity Hours

Determining the peak electricity hours in your vicinity can be as simple as observing your own usage trends. Energy consumption patterns within a community typically remain relatively consistent. When you're using the most electricity, it's probable that your neighbors are doing the same.

As a point of reference, here are the typical peak periods in different time zones.

Peak Electricity Hours in Summer

Time zone	Hours
Eastern	2 PM - 6 PM
Central	1 PM - 5 PM
Mountain	8 PM - 11 PM
Pacific	5 PM - 9 PM

Peak Electricity Hours in Winter

Time zone	Hours
Eastern - Peak 1	6 AM - 10 AM
Eastern - Peak 2	6 PM - 10 PM
Central - Peak 1	5 AM -  9 AM
Central - Peak 2	5 PM - 9 PM
Mountain	7 PM - 10 PM
Pacific - Peak 1	6 AM - 10 AM
Pacific - Peak 2	5 PM -  8 PM

Keep in mind that these are general timeframes. For precise information on your specific peak electricity hours under your Time of Use plan, it's advisable to reach out to your utility company.

What Are Off-Peak Electricity Hours?

Unlike peak (or 'on-peak') electricity hours, off-peak hours are characterized by the lowest electricity demand and consumption, resulting in lower electricity prices.

The specific off-peak rates and hours may vary based on your location and utility provider. Typically, off-peak hours coincide with times when homeowners and occupants are often away from home, such as during work or school hours.

Timing: Identifying Off-Peak Electricity Hours

Determining your region's off-peak electricity hours is as simple as observing your own daily routine. Since working and school hours align closely among households, electricity demand tends to be lowest during the standard working hours.

The typical off-peak electricity hours for various time zones are outlined below. It's important to note that these off-peak hours apply primarily to weekdays, as energy consumption patterns often differ during weekends.

Off-Peak Electricity Hours in Summer

Time zone	Hours
Eastern	6 PM - 2 PM
Central	5 PM -  1 PM
Mountain	11 PM - 8 PM
Pacific	9 PM - 5 PM

Off-Peak Electricity Hours in Winter

Time zone	Hours
Eastern - Off-peak 1	10 AM - 6 AM
Eastern - Off-peak 2	10 PM - 6 AM
Central - Off-peak 1	9 AM -  5 PM
Central - Off-peak 2	10 PM -  5 PM
Mountain	10 PM - 7 AM
Pacific - Off-peak 1	10 AM - 5 PM
Pacific - Off-peak 2	8 PM - 5 AM

Why Utility Companies Are Transitioning To Time Of Use Rates And Peak Hours

What Are Time of Use rates?

Time of Use rates, commonly known as TOU rates, present a dynamic approach to electricity billing by adapting costs according to the specific time of day when electricity is utilized. This billing strategy is designed for residential customers, introducing a tiered system where electricity rates vary based on the demand throughout the day.

During peak hours, characterized by high electricity demand, TOU rate plans implement a higher cost per unit of electricity consumed. This serves as an incentive for consumers to minimize electricity usage during these peak periods, ultimately assisting in the stabilization of the power grid.

Conversely, off-peak hours, which witness lower electricity demand, feature a lower cost per unit of electricity. This encourages consumers to shift their energy-intensive activities to these hours, fostering a more balanced distribution of electricity consumption.

In essence, TOU rates aim to align electricity costs with the actual demand, promoting efficiency and sustainability in energy consumption patterns. This innovative billing approach not only provides consumers with the opportunity to manage their electricity expenses but also contributes to the overall stability and optimization of the electricity grid.

Why do utility companies use Time of Use rates?

Utility companies adopt Time of Use (TOU) rates for several strategic reasons. The fluctuating prices for consumers using electricity mirror the variations in the costs for utilities in producing electricity. Conventionally, producing electricity during peak hours comes with higher expenses for utility companies. To address this economic challenge, utility companies have implemented Time of Use rates.

By incorporating Time of Use rate plans, utility companies aim to achieve two primary objectives. Firstly, during periods of high demand, the implementation of TOU rates acts as an effective mechanism to reduce overall electricity usage. Consumers, motivated by the cost implications, tend to limit their electricity consumption during peak hours, contributing to a more balanced and sustainable energy distribution.

Secondly, Time of Use rates enable utility companies to align electricity rates with the actual production costs. The increased rates during peak hours help offset the higher expenses incurred in generating electricity during these periods. This not only reflects the economic reality of electricity production but also provides utility companies with a means to manage and optimize their operational costs.

In essence, the adoption of Time of Use rates by utility companies represents a strategic approach to balancing electricity demand, promoting efficiency, and ensuring a cost-effective and sustainable operation of the energy grid.

Difference in Costs Between Peak and Off-Peak Electricity Prices

A common question is likely to revolve around the disparity in pricing between peak and off-peak hours. The truth is, these prices can fluctuate based on various utilities and seasons. Let's delve into an example featuring two Time of Use rate plans provided by California electric utility PG&E.

Plan 1: E-TOU-C
Summer costs

Under Plan 1: E-TOU-C, the cost breakdown for summer electricity is as follows:

• Off-peak electricity: Priced at 33-42 cents per kilowatt-hour (kWh)
• Peak electricity is set at 40-49 cents per kWh.

Winter costs

Under Plan 1: E-TOU-C, the cost breakdown for winter electricity is as follows:

• Off-peak electricity: Priced between 28 and 37 cents per kilowatt-hour (kWh).
• Peak electricity: Priced in the range of 30 to 39 cents per kWh.

Plan 2: E-TOU-D

Summer costs

Under Plan 2: E-TOU-C, the cost breakdown for summer electricity is as follows:

• Off-peak electricity: Priced at 34 cents per kilowatt-hour (kWh).
• Peak electricity is set at 47 cents per kilowatt-hour (kWh).

Winter costs

Under Plan 2: E-TOU-C, the cost breakdown for winter electricity is as follows:

• Off-peak electricity: Priced between 34 cents per kilowatt-hour (kWh).
• Peak electricity: Priced in the range of 38 cents per kWh.

In these TOU rate plans, you can see that the price gap between off-peak and peak hours is quite noticeable in the summer, ranging from 7 to 13 cents per kilowatt-hour (kWh). On the flip side, the difference is not as pronounced in winter, hovering around 2 to 4 cents per kWh.

Time of Use with Existing Solar Customers

Time-of-use (TOU) pricing becomes significantly impacted for solar customers because of their ability to utilizesolar energy. With solar panels generating electricity during daylight hours, typically from 8 am to 4 pm, it's now advantageous to align energy consumption with this period. During these peak production hours, electricity is often cheaper due to excess supply from solar generation, whereas costs may surge during early morning or evening hours when solar energy production wanes, leading to higher TOU rates. Thus, optimizing energy usage to coincide with solar generation periods not only maximizes cost savings but also reduces reliance on grid electricity, promoting sustainability and efficiency in energy consumption.

How to Save Money with Time of Use Rates

Maximize your electricity usage during off-peak hours:

If you're enrolled in a TOU plan, optimizing your energy consumption during off-peak periods can lead to significant cost savings. Consider operating energy-intensive appliances like the washer, air conditioner, or electric vehicle charger when electricity rates are lowest, contributing to noticeable reductions in your overall electric bill.

Incorporate a home battery solution:

Charge your home battery during off-peak hours, enabling you to harness stored power during peak periods and avoid higher energy costs. Additionally, a home battery solution offers protection from outages and blackouts, providing an added layer of security for your energy needs.

Invest in solar plus storage:

A solar panel system, coupled with battery storage, allows you to generate and store excess solar power during the day. When evening peak hours arrive, you can seamlessly rely on your battery to fulfill your energy requirements, eliminating the need to purchase costly peak-hour electricity from your utility. This not only ensures a reliable power supply but also translates into significant cost savings.

The Bottom Line

For homeowners, whether equipped with solar panels or not, the most cost-effective electricity is available during periods outside mid-peak and peak electricity hours. Strategically scheduling the use of lighting, appliances, and HVAC systems during these times offers several advantages:

• Helps avoid peak Time of Use (TOU) charges
• Shortens the payback period for infrastructure investments
• Supports better maintenance of the electrical grid by utilities and operators

Whether you're generating power during off-peak or peak hours, Forme Solar is committed to assisting you in optimizing your energy generation. To embark on harnessing solar power, contact us at 1-714-694-2262 or fill out our online inquiry form. Our energy consultants are ready to provide a free consultation and quote!