1. What are peak hours and off-peak hours?
1.1 Peak hours
Peak hours are the times of the day when the demand for electricity is the highest. Depending on the area and people’s living habits, the peak hours set by different power companies may be different, but the peak hours in residential areas are usually in the evening, from 4:00 p.m. to 8:00 p.m. This is because this is the time when people get off from work and school. Because this is the time when people get off from work and school, most of them return home and start to use a lot of electrical appliances.
1.2 Non-peak hours
Off-peak hours are times of the day when companies and homes use less electricity. For most areas, off-peak hours are in the evening. Electricity consumption generally goes to a lower level during times when businesses are closed and residential areas go to sleep.
Overall, peak and off-peak power hours are influenced by a variety of factors, including the region, the utility company in the location, the season, and the weather. Of these, the effect of the season is the most significant.
For example, in the winter, peak hours may occur between 6:00 a.m. and 10:00 a.m. and between 7:00 p.m. and 10:00 p.m. in the evening, whereas in the summer, peak hours generally occur only in the evening. In addition, regional differences can also have an impact, but the approximate time period will not change significantly.
2. Which time of day is cheaper and why utilities use time-of-use tariffs?
Generally speaking, electricity is cheaper during off-peak hours. Because of the high demand for electricity during peak hours, which puts pressure on energy companies and the grid, utilities and energy companies must choose to increase their peak capacity or purchase power directly from the market to meet peak energy demand, both of which are quite costly. Energy companies may choose to increase the price of electricity during peak hours in the hope that more customers will choose to use more electricity during off-peak hours in order to balance the demand for electricity in the interest of saving energy costs.
Generally speaking, not all regions and utilities use the same type of time-of-use billing. The following is one of the most widely used and popular TOU billing methods.
This billing method divides the year into winter and summer, with different time-of-day billing and price settings for each season. On weekdays during the summer months, 4:00 p.m. to 9:00 p.m. is set as the peak hour, and rates are more than twice as high as the rest of the year, whereas on weekends, rates for the same peak hour are about half of what they are on weekdays. Billing is more complicated in the winter than in the summer. On weekdays, 9 p.m. to 8 a.m. is set as the off-peak hour and has the cheapest rates. This is followed by 8 a.m. to 4 p.m., which is set as a medium-use period and is slightly more expensive than the off-peak period. The evening hours of 4:00 pm to 9:00 pm continue to be the peak hours with the highest tariffs. It is worth noting that the weekday and weekend time-of-day tariffs are the same in winter, and the peak tariffs in winter are lower than the peak tariffs in summer.
3. How to utilize off-peak hours to save electricity costs?
Due to time-of-use tariffs, your electricity bill will vary at different times of the day. When your household’s demand for electricity is high, saving money by taking advantage of the lower tariffs during off-peak hours is a good option. You can do this in several ways:
3.1 Change the time of day you use electricity
The most straightforward way to save money on your electricity bill is to use appliances, especially certain large appliances, when electricity prices are cheap. You can save a lot of money on your electricity bill if you are able to shift their use to off-peak hours. Therefore, you may consider taking a short break from work before using the electric water heater to take a shower, or start using the washing machine to do your laundry in the evening after the hotel, instead of doing these things immediately after work.
3.2 Installation of Smart Electricity System
You can choose to install an intelligent power system for your home, which works on large power-consuming devices such as thermostats. It can save money on your electricity bill by setting high efficiency during off-peak hours and low efficiency during peak hours. Make sure your air conditioners and thermostats don’t run on high power in the afternoons and evenings when electricity is expensive.
3.3 Use smart appliances and devices
You also have the option of using smart batteries and devices that can automatically help shift your usage to off-peak electricity hours. These smart appliances are simple to use and usually come with an automatic switch-on function at a preset time or a delayed start time that can be set. If your home is equipped with a smart home, you can set your washing machine, dishwasher, dryer and other large appliances to work in the early hours of the morning before you go to sleep, which can save you a lot of money by working during the lowest-priced hours of the day.
3.4 Turn off non-essential appliances
Turning off non-essential appliances during peak hours is always the easiest, most direct and most effective way to save electricity. Large appliances such as washing machines, televisions, ovens and other non-essential appliances can be turned off during peak hours. Of course, refrigerators and other essential appliances are best not to be easily turned off.
4. In addition to utilizing off-peak hours, what are some other ways to save money on electricity?
4.1 Using solar power and combining it with energy storage
In addition to avoiding peak hours, there are more favorable ways to save electricity, such as installing solar panels to generate electricity. However, installing solar panels is generally not enough to supply your home’s energy consumption unless you also install solar battery. Most homes that install a complete solar system are able to take care of their own electricity, and not only that, they are also able to sell the excess electricity produced by their solar system during peak hours for a profit.
5. Other issues regarding peak and off-peak hours
5.1 How Peak and Off-Peak Hours Affect Businesses
Peak tariffs can place a significant burden on businesses, particularly those that rely heavily on the use of electricity. Not only does this increase their operating costs, but the strain on the grid during peak hours can lead to fluctuations in the power supplied, or even sudden blackouts, which can also result in production losses for businesses. In order to adapt to the status quo, some enterprises have begun to shift their key production tasks to off-peak hours, and have invested in power-saving equipment and set their sights on other alternative energy sources for power generation, so as to improve the stability and sustainability of their operations.
5.2 How to use cheaper ways to charge electric vehicles
For households that have purchased electric vehicles, it is important to utilize off-peak hours to save money on electricity consumption. In order to minimize the power consumption of your EV, you can choose to install smart features for your EV charger: start and stop times for charging can be present remotely. But even if your charger doesn’t have such a feature, the utility company may offer you incentives to help you pay for charging.
