Many people are unfamiliar with Time of Use (TOU) electricity plans, knowing only that they are more affordable versions than fixed-rate plans. Even if they've heard about the benefits, the details might still be unclear. If you're one of the many Americans grappling with the concept of TOU plans, here’s what you need to know.
TOU is an electricity pricing plan that charges varying rates based on the time of day or season, allowing consumers to save money on electricity bills. Of course, this is just the basics, and the benefits of TOU plans are numerous. Keep reading to find out exactly how this pricing structure works and which one is the best option for you.
What is a TOU plan?
Before exploring the benefits of a TOU plan, let's begin by defining this unique approach to electricity pricing structure. TOU, which stands for "Time of Use," is an innovative system where utility companies charge different electricity rates based on the on-peak and off-peak periods. During peak demand periods, like hot summer afternoons, electricity rates are higher, while off-peak hours offer lower rates.
Now, you must be wondering: Which hours are off-peak? It depends on each provider's unique plans and schemes, but as mentioned, summer afternoons are defined as the on-peak period of the day. Texas on-peak hours are from 1 p.m. to 7 p.m., Monday through Friday, meaning that early mornings and late evenings, as well as weekends, are periods when you pay less for electricity.
This is possible because the demand for electricity is lower as businesses and households typically consume less power during this period. As a result, utility companies offer lower rates during these times to incentivize consumers to use electricity when the demand on the grid is not as high. By shifting energy-intensive activities to off-peak hours, consumers can take advantage of the reduced rates, leading to potential cost savings on their electricity bills.
The goal of this pricing tariff is to encourage consumers to adjust their energy consumption habits and shift usage to times when demand is lower. This way, energy efficiency is promoted and, at the same time, consumers save on electricity bills.
Advantages of TOU Rates
TOU plans offer numerous advantages for consumers seeking to manage their energy consumption and reduce costs. Here are the most important things that you should know about TOU rates:
Unlike a flat-rate pricing structure, TOU rates fluctuate with the time of day, offering lower rates during off-peak hours. At any time, you can see how much energy you use and how much you pay for it, so everything is transparent.
Unlike some competitors who offer "free hours" but double charge during the night, Rhythm Energy does not offset charges to later in the evening. Rhythm Energy offers straightforward rates, ensuring energy consumption is managed efficiently without any hidden costs or surprises.
One of the most important benefits of switching to Rhythm Energy's time of use plan is lower electrical bills. That could be easily done if you know how to manage home appliances that use the most energy, such as AC, dishwashers, and pool pumps. For example, if you program your dishwasher around off-peak hours, you'll definitely save a few dollars monthly. Consider doing the same with other appliances, like washing machines or electric vehicles, and watch the savings add up month after month. With Rhythm Energy's PowerShift 12 Plan, you can easily maximize your cost savings.
Control on Energy Usage
As mentioned, with TOU pricing, you gain better control over your energy usage. But, you do more than that. By switching energy-intensive activities to off-peak hours and days, you will reduce the strain on the power grid. The most significant benefit a community derives from TOU plans is more efficient energy consumption, controlling grid overload, and contributing to a greener and more sustainable environment.
Benefit To Environment
TOU rates have a positive impact on the environment by incentivizing consumers to use electric energy when the cost of producing electricity is cheap. During the on-peak hours, the grid relies on fossil fuels. By shifting major electricity consumption away from on-peak hours, there is less need for fossil fuel generation. The outcome is better air quality and lower greenhouse gas emissions. Rhythm Energy plans empower users to reduce their carbon footprint and contribute to a brighter future for Texas. They are created with the idea of promoting sustainable energy, relying more on solar power and less on fossil fuels.
What is the best time of day to use electricity?
The best time of day to use electricity depends on the time of use rate plan you chose. Generally, off-peak hours, such as early mornings, late evenings, and weekends, offer lower electricity rates. During these periods, you can take advantage of TOU by reducing the usage of energy-intensive appliances. For example, you should wash your clothes or dishes only during off-peak periods, or charge your EV during the night. This way, you will optimize your energy consumption.
What time is it cheapest to use electricity?
The cheapest time to use electricity is typically during off-peak hours, usually before 1 p.m. and after 7 p.m. during business days. Weekends are also considered off-peak periods when electricity demand is lower and rates are cheaper.
If you are tech-savvy and have a smart home setup, you can maximize the benefits of our EV plans, such as PowerShift EV Seasonal 12 Plan. With everything connected to your phone, such as the pool pump, EV charger, dishwasher, and laundry, you can easily schedule tasks during off-peak hours and avoid on-peak pricing. While this plan may seem complex, Rhythm Energy has other electricity plans that cater to different needs.
What time of day is best to save electricity?
The best time of the day to save electricity is early morning and night when the demand for energy consumption is generally lower. This is the perfect time to schedule energy-intensive tasks, like laundry, running the dishwasher, or charging your electric vehicle.
But, saving energy is possible at any moment. For example, you can follow the 4x4 rule: if you are away for over 4 hours, raise the home temperature to 4 degrees and adjust it upon return. You should use LED lights because of their longer-lasting illumination. The small changes in habits can help you save electricity and enjoy lower bills.