There are homeowners paying more for electricity than they need to – not because they’re using more power, but because they’re using it at the wrong times. Yes, when you use electricity can absolutely affect what ultimately ends up on your electric bill. That’s because of something called a Time-of-Use (TOU) rate plan, where electricity prices change depending on the time of day. This is where concepts like peak and off peak times come into play and can mean the difference between maximizing your savings or leaving hundreds of dollars on the table each year. In this guide, I’ll walk you through what peak and off peak electricity hours are, why utility companies use them, and how you can take advantage of them to lower your electricity costs.
What are Peak and Off Peak Hours?
Peak and off peak hours are time periods tied to what’s called a Time-of-Use (TOU) rate plan, wherein the price one pays for electricity changes depending on the time of day.
We’ll explore why such a billing structure exists in more detail later. But for the most part, the reason revolves around how utilities have to balance electricity supply and demand, considering how electricity consumption fluctuates throughout the day and, in many cases, across seasons as well.
On the consumer side, it gives homeowners a way to control their electricity costs, not necessarily by using less energy, but by using it strategically at the ‘right’ times.
What are Peak Electricity Hours?
Peak electricity hours are the times of day when demand for power is at its highest – and because of that, they’re also the most expensive.
According to the U.S. Energy Information Administration, electricity demand typically reaches its highest levels during the late afternoon and early evening, especially during the hot summer months.
Image Source: U.S. Energy Information Administration (EIA)
As such, peak hours typically occur somewhere between 3 PM and 9 PM, although the exact timing depends on your utility provider and location. For example, some utility providers have peak hours that start as early as 1 PM, especially in areas with high cooling demand during hot summer afternoons.
If you think about it, this window is when most people get home from school or work and turn on multiple heavy energy-consuming appliances at once. Multiply that across hundreds or even thousands of households, and that sudden surge puts big pressure on the grid. In response, utilities charge higher rates during these hours.
What are Off Peak Electricity Hours?
Off peak electricity hours are the times of the day when energy demand is the lowest. As such, they’re also the cheapest times of the day to run your appliances.
This usually happens late at night or early in the morning, typically between 9 PM and 6 AM, when most households are asleep and overall demand on the grid is low. Again, the specific time frame can vary depending on your utility provider and geographic location.
It goes without saying this is your best window to run energy guzzlers like dishwashers and washing machines, or even charge an electric vehicle overnight. Making such shifts in energy consumption habits can dramatically lower your electric bill.
What is Super Off Peak Hour?
A super off peak hour is an even lower-cost period within off peak times, where electricity demand is at its absolute lowest.
Take Georgia Power’s Overnight Advantage plan, for example. As of writing, it offers super off-peak pricing from 11 PM to 7 AM at $0.022 per kWh. That’s roughly 78% lower than the plan’s standard off-peak rate of $0.102 per kWh, and about 93% lower than its on-peak rate of $0.298 per kWh.
Another example is Duke Energy’s Residential Time-of-Use (RST-1) plan, which, refers to its super off-peak period as a “discount period.” Under this plan, the discount period runs from 12 AM to 3 AM during winter and from 12 AM to 6 AM during summer.
That being said, not all utilities follow this structure. Case in point, Utah’s Rocky Mountain Power and Murray City Power.
Examples of Peak and Off-Peak Hours
Rocky Mountain Power
For homeowners in Salt Lake City, West Valley City, West Jordan, Sandy, South Jordan, Herriman, Taylorsville, Draper, Riverton, and Park City served by Rocky Mountain Power, the utility’s Residential Time-of-Use (Schedule 1) plan currently uses the following peak and off-peak schedule:
| Period | Time | June-September Rate | October-May Rate |
|---|---|---|---|
| On-Peak | 6 PM-10 PM | 32.08¢/kWh | 28.39¢/kWh |
| Off-Peak | 6 AM-6 PM and 10 PM-6 AM | 7.13¢/kWh | 6.31¢/kWh |
*Weekends and designated holidays are off-peak all day. As you can see, electricity during on-peak hours costs roughly 4.5 times more than during off-peak hours. On the other hand, Murray City Power (serving the city of Murray) doesn’t currently offer a residential Time-of-Use rate. Instead, residential customers are generally billed under seasonal rate schedules.
Duke Energy
What’s unique about Duke Energy’s Residential Time-of-Use (RST-1) plan is that it uses two separate on-peak windows during winter. From December through February, on-peak hours run from 5 AM to 10 AM and again from 6 PM to 9 PM on weekdays. During the rest of the year, only the evening peak period applies.
| Period | Applicable Months | Time | Rate |
|---|---|---|---|
| On-Peak | December–February | Weekdays, 5 AM–10 AM and 6 PM–9 PM | 11.090¢/kWh |
| On-Peak | March–November | Weekdays, 6 PM–9 PM | 11.090¢/kWh |
| Off-Peak | All Year | All other hours not listed above | 8.215¢/kWh |
| Discount Period | December–February | Every day, 12 AM–3 AM | 4.984¢/kWh |
| Discount Period | March–November | Every day, 12 AM–6 AM | 4.984¢/kWh |
Southern California Edison It may seem strange to some but Southern California Edison’s Time-of-Use plans introduce a super off peak period during the middle of the day, rather than overnight. For example, under SCE’s TOU-D-4-9PM plan, winter super off peak hours run from 8 AM to 4 PM, while the highest-priced period occurs from 4 PM to 9 PM. You can check out the full details of SCE’s more extensive TOU schedules and rates on their website.
Why do Electric Companies Have Peak and Off Peak Hours?
Consumer Demand The common theme behind all of this is demand. Peak and off peak pricing is driven by how many people are using electricity at the same time. When millions of households turn on appliances, cooling systems, and electronics all at once, enormous amounts of electricity are siphoned from the grid, forcing utilities to work harder to keep up with demand. On the other hand, when most people are asleep or away from home, demand takes a huge dip. Utilities take advantage of this lull by offering lower rates during off peak hours to encourage usage when the system isn’t under pressure. Weather and Seasons During summer, air conditioners run for longer hours, pushing electricity usage into the late afternoon and early evening. In winter, heating systems increase usage during the early mornings and evenings instead. This is why peak hours often shift depending on the season. Utilities adjust their pricing schedules to match these patterns so they can better manage the load on the grid. Once again, the common denominator is demand. Local Grid Conditions Not all grids are built the same. Some areas have older infrastructure or limited capacity, which means they feel the strain of high demand more quickly. Others may have stronger systems or access to more local energy sources, allowing them to handle demand more efficiently. As a result, peak hours in one city may not match another, even within the same state. Your utility sets these peak and off peak windows based on what their local grid can handle. Energy Supply Costs The cost of producing electricity also changes throughout the day, and utilities pass those costs on to consumers. During peak periods, utilities often have to rely on more expensive power sources, sometimes called “peaker plants”, to meet sudden spikes in demand. These sources cost more to operate, which drives up electricity prices during those hours. During off peak times, cheaper and more stable energy sources are usually enough to meet demand. That explains why electricity costs less when overall usage is low.Ways to Take Advantage of Cheaper Electricity
You don’t have to give up comfort just to save on electricity. If you’re on a TOU plan, there are ways to reduce your electricity costs without necessarily using less power. For the most part, it comes down to using electricity more strategically at certain times or with the help of technologies that do much of the work for you.
Solar Panels and Solar Batteries
With solar panels and solar batteries, you’re able to generate and store your own energy. That allows you to dodge, or at the very least soften, the impact of peak-hour electricity prices. Here’s how that works.
During the day, solar panels often produce the most electricity when the sun is strongest. In most cases, homeowners are at work or school during these hours, which means much of that production becomes excess energy. Instead of sending all of it back to the grid, a battery stores the surplus for later use.
Then, when peak hours arrive in the late afternoon or evening, your home can draw from that stored energy first instead of purchasing electricity at expensive peak-hour rates from the grid.
Of course, this ideal scenario depends on having a properly-sized solar system that matches your household’s energy needs. A qualified solar installer can analyze your electricity usage patterns and recommend an appropriate solar and battery setup.
But even if your system only offsets part of your peak-hour usage, that’s still less expensive electricity you’re buying from the utility. Because if you had the choice between paying for 100% of your peak-hour electricity or only a fraction of it, which would you choose? Certainly not the former.
Smart Appliances
Many modern dishwashers, washers, dryers, and thermostats come with built-in scheduling features that allow you to pre-set when they operate. Instead of waiting until late at night to turn them on, you can program these appliances to run automatically during the cheaper off peak hours.
It may seem like a minor adjustment, but you’d be surprised how much the savings from these small shifts can add up over time – and without requiring any real change to your routine at that.
Energy Efficiency Upgrades
No amount of shifting your usage to cheaper hours will fully pay off if your home is consuming more electricity than it needs to in the first place. At the end of the day, using less power is still one of the most reliable ways to lower your bill.
That’s where energy efficiency upgrades come in.
LED lighting, high-efficiency HVAC systems, or ENERGY STAR-rated appliances reduce how much power you draw from the start. That means when you do run appliances during off peak hours, you’re already using less electricity, making those cheaper rates work even more in your favor.
It’s also worth noting that energy efficiency upgrades aren’t limited to appliances. There’s also home efficiency upgrades that can help reduce overall energy consumption. Think of home improvements like better insulation, air sealing, energy-efficient windows, reflective roofing materials, and modern HVAC systems.
These upgrades can be particularly effective considering how heating and cooling represent the largest residential electricity uses, according to the U.S. Energy Information Administration.
Reduce Your Electricity Bills with Avail Solar
Solar panels generate electricity during the day, and with a battery, you can store surplus energy for later use. It’s one of the most effective ways to avoid getting stuck buying expensive on-peak electricity year after year.
At Avail Solar, we make your transition to solar easy by handling everything from system design and permitting to installation and ongoing support. Ready to take control of your electricity bill and enjoy bigger savings? Give us a call today!