Electricity seems to cost more every year, and as those expenses rise, consumers are feeling the pinch. This isn't a bill you can just eliminate, but that doesn't mean there aren't ways to save money. If you've been stressing over a giant electric bill, it's time to consider when you're using the most power. The price of electricity changes during the day, rising during peak hours, and becoming more affordable during off-peak hours. Depending on what time of day you're running the washing machine or dishwasher, you might be paying a premium for electricity.Â
This model is like surge pricing that Uber uses, except it's more convenient to use it to your advantage. The pricing varies as per demand -- when the grid is strained with lots of people plugged in, the demand is higher and so are the prices. On the other hand, when the grid isn't as busy, you can get lower pricing. If your utility company has you on a time-of-use plan, you can use it to your advantage during off-peak hours and keep the heavy electricity use limited to the time of day when electricity is at its cheapest. We've also got tips on the best time of day to do laundry to save money, and how to lower your water bill.
What are peak hours?
In a time-of-use electricity plan, peak hours -- sometimes referred to as on-peak hours -- are the hours of the day when electricity demand is the highest. During this time, you will be paying the highest amount per kilowatt-hour used.Â
Some electricity use is going to be unavoidable, whether it's your refrigerator keeping your food cool or your security system that's always on and protecting your home. Peak hours are a bad time to do tasks that can wait. If you're running large appliances, whether it's your dishwasher or washing machine, it's going to cost you extra during peak hours.
What are off-peak hours?
In contrast to peak hours, off-peak hours are the times when electricity prices are cheaper. This is typically the case because fewer people are trying to access the grid during these hours, meaning there is less overall demand and you won't have to pay a premium for each kWh that you use.
Off-peak hours are a great time to do those more energy-intensive tasks that you may have waiting for you. While it might not be the most convenient, if you happen to be home during off-peak hours, you can save money on your monthly electricity bill by timing your tasks to these time frames.
Why do utility companies use time-of-use rates?
Utility companies know when stress on the grid is going to be at its highest. To make sure the grid can serve all of these customers, they need to make sure that power plants are operational and meeting all of the demand. When demand increases, these companies may have to generate more electricity, which can cost more. They either need to generate that power in advance to meet the peak or purchase extra energy from other sources. That additional expense is passed on to the consumer through time-of-use rates, which charge you more when you use electricity during peak hours.
When are peak hours?
Peak hours vary depending on the time of year and region of the country. As a general rule, think of peak hours as the time during which most people are getting home from work for the day. This is when people are turning on their lights, firing up their TVs and settling into their homes for the night -- all of which require more electricity than usual.Â
Here's an overview of peak and off-peak hours by Eastern, Central, Mountain and Pacific time zones. Note that select states may have different time of use schedules, be sure to select your state from the menu on your provider's website if applicable.
Summer
| Time zone | Peak hours | Off-peak hours |
|---|---|---|
| Eastern | 2-6 p.m. | 6-2 p.m. (next day), Weekends all hours |
| Central | 1-5 p.m. | 5-1 p.m. (next day), Weekends all hours |
| Mountain | 8 a.m.-11 p.m. | 11 p.m.-8 a.m. |
| Pacific | 5-9 p.m. | 9-5 p.m. (next day) |
Winter
| Time Zone | Peak hours | Off-peak hours |
|---|---|---|
| Eastern | 6-10 a.m.; 6-10 p.m. | 10 a.m.-6 p.m.; 10 p.m.-6 a.m., Weekends all hours |
| Central | 5-9 a.m.; 5-9 p.m. | 9 a.m.-5 p.m.; 9 p.m.-5 a.m., Weekends all hours |
| Mountain | 7 a.m.-10 p.m. | 10 p.m.-7 a.m. |
| Pacific | 6-10 a.m.; 5-8 p.m. | 10 a.m.-5 p.m.; 8 p.m.-5 a.m. |
Additional money-saving tips
Typically, weekends are considered to be off-peak hours for the full day. This means that if you can time your energy-intensive tasks to Saturday and Sunday, you can typically save yourself some money when it comes to your monthly energy bill. Equipped with the knowledge of when peak hours occur and what times are considered to be off-peak hours, you can figure out how to time your use of major appliances to off-peak hours and keep your energy costs down. You can also consider purchasing tools like a solar battery that will provide you with an energy reserve so you don't have to draw from the grid during peak hours.
You can also use this knowledge to save more by minimizing the amount of electrical usage that you require during peak hours. You can unplug your appliances that you aren't using, make sure that your thermostat is set properly so your furnace is not running as much during peak hours, and utilize "sleep" mode on things like your computer and TV to make sure they aren't using unnecessary electricity that will cost you more. You may also want to consider using motion sensors in your home that can be equipped to interact with other electronic devices. For example, if you aren't home, there is no need for your lights to be on. Setting them to a motion sensor would ensure they won't turn on unless you're home and moving around.