Time-of-Use Electricity Plans, Explained in Plain English
A time-of-use (TOU) plan charges different prices by hour: expensive on-peak (weekday late afternoon and evening) and cheap off-peak (overnight). It pays off when you can shift a big load, usually overnight EV charging, into the off-peak window.
How time-of-use pricing works
A time-of-use rate charges more for electricity when grid demand is high and less when it is low. Instead of one flat price per kilowatt-hour, you pay an on-peak price during busy hours and a lower off-peak price the rest of the time. The utility’s goal is to spread demand; your opportunity is to move usage to the cheap window.
When are peak and off-peak hours?
On-peak hours are typically weekday late afternoon and early evening, roughly 4 PM to 9 PM, when everyone is home running air conditioning, ovens, and dryers. Off-peak hours cover overnight and early morning, most commonly about 9 PM to 7 AM, plus many weekends and holidays. Some utilities add a super off-peak overnight tier that is cheaper still.
Exact windows vary by utility and by season, summer peaks are usually longer and pricier than winter. Always read your specific rate schedule before you switch.
When a TOU plan is worth it
TOU beats a flat rate only if you can move a meaningful share of your usage to off-peak hours. The math is simple: everything you use on-peak costs more than it would on a flat rate, and everything you shift off-peak costs less. If your evenings are heavy with cooking and cooling, a flat rate is often cheaper.
- Good fit: an EV you charge overnight, a pool pump or water heater on a timer, laundry you can run late.
- Poor fit: heavy evening air conditioning, electric cooking at dinnertime, no shiftable loads.
Why EV owners save the most
An EV is the ideal shiftable load. A car charging overnight moves a large, predictable block of kilowatt-hours into the cheapest window automatically. Many EV owners cut their charging cost 30–60% this way, commonly saving $300–$800 a year. Set a charge schedule on the car or the Level 2 charger so it starts after the off-peak window begins.
Before you switch
Most TOU plans need a smart (interval) meter, which many US utilities have already installed. Pull a recent bill, estimate how much of your usage you can realistically shift, and compare the plans. If you can move most EV charging overnight, the off-peak rate usually wins even after the higher peak price on the rest of your usage.
Common questions
Is electricity cheaper at night?+−
On a time-of-use plan, yes, overnight is normally the cheapest window because grid demand is lowest. On a flat-rate plan the price is the same all day, so night charging only saves money if you are enrolled in a TOU rate.
Do I need a special meter for a time-of-use plan?+−
Most TOU plans need a smart (interval) meter that records when you use electricity. Many US utilities have already installed one; if not, they typically add it at no charge when you enroll.
What is super off-peak electricity?+−
Super off-peak is an extra-cheap overnight tier some utilities offer in the early-morning hours. It is the ideal window to schedule EV charging for the lowest possible cost.