What Does “Time-Of-Day” Billing Mean?

And can it aid in the fight against global warming?

To begin, Time-of-Day (TOD) electric rates, also known as Time-of-Use rates, are designed to induce consumers to use electricity during hours when the utility’s system is not at peak load. These times are called “off-peak” hours.

The inducement is created when the utility charges a premium during periods of high demand on the utility’s system and offers a discounted rate during off-peak hours.

So when are these peaks and off-peaks anyway? Well they occur pretty much as you would expect – the highest during the hottest summer days when air-conditioning demand is at its highest.

And before there was air-conditioning the highest peak was during a dark winter evening.

The off-peak hours would be, again as you would imagine, after working hours on work days and all day and night on weekends. And you might say, “what about air-conditioning on weekends?” And the answer would be that residential cooling loads are not anywhere near the total of commercial, industrial and residential on regular workdays.

You will also see that in addition to weekends, holidays are also given credit as totally off-peak times.

But some of our favorite utilities could not leave well enough alone. They decided that maybe too much off-peak credits were being given and so for some of the hours between peak and off-peak, they invented “Shoulder-Peak Hours.” In effect they said in answer to some of your residential air conditioning, “We gotcha”

These Shoulder Hours would be before and after work hours on weekdays and in some cases even on weekends. The Peak, Off-peak and Shoulder Hours vary from state to state and utility to utility. Your local supplier will be pleased to provide your local information.

Finally, to make life easier, there are computer programs designed to remind you when you should not run your washer, dryer, dishwasher or air conditioning. But being creatures of habit we can pretty much tell when the peak hours are.

And in following the TOD program we are all helping to ease some of the pressure on the grid that delivers electricity around the country. And lowering the peak also helps to “green” the ecology.

So you see – it’s not only the other guys who can help – it’s all of us!