What is TOU - Nature's Generator

What is TOU

Discover how to reduce your energy bills and get valuable rewards by understanding how Time-of-Use rates work.

Did you know that your whole home can be more energy efficient just by choosing when to do certain household chores? You can pay less, earn rewards or rebates, and save more by understanding how Time-of-Use (TOU) rates work. It is basically a pricing structure wherein consumers are encouraged to do tasks or chores that involve the use of electricity during off-peak hours. 

The U.S. Department of Energy compiled a comprehensive list of utilities in the Western, Northeastern, Southeastern, and Midwestern states that offer demand response and time-variable pricing programs. You can check or better yet, contact your electric utility provider if they have these types of rate programs in your location. By being aware, you are allowing yourself to potentially enjoy rebates such as bill credits or payments just for reducing your load or by shifting your electrical load towards off-peak hours.  

Time-of-Use Rates Explained 

Aside from the off-peak hours, electric utility companies also give homeowners the option to cut energy costs based on the day of the week, and sometimes even the season. The primary goal of this is to promote sustainability by incentivizing consumers to reduce their dependence on the electrical grid during certain times. 

Energy utilities typically offer TOU rates according to set times namely peak hours, off-peak hours, and shoulder hours. Peak hours mean that the electrical grid is at its highest capacity because of the high demand for electricity due to different reasons. For instance, the majority of people coming home after a day’s work means that there would be an increase in the use of heating or air conditioning systems depending on the season.  

These set times vary by region, season, and utility provider but it would be helpful to remember that peak hours typically occur during the late afternoon until early evening on weekdays. For example, 4:00 PM to 9:00 PM. Off-peak hours in the residential areas usually start around 10:00 PM until 6:00 AM. Shoulder hours are simply the hours before or after peak hours.  

Peak hours mean rates are generally higher while off-peak hours have lower rates. This means that if you avail of a Time-of-Use plan, you can adjust when to use the appliances or devices  
that require a heavy load of electricity in order to lessen your bill. 
Now that you know what TOU rates mean and how they basically work, it would be a good idea to contact your service provider or utility company to know if they are offering time-of-use plans. If yes, you can ask them to send you a copy of their current on and off-peak hours and rates and start considering if you will avail their offer.


Are TOU rate plans right for you? 

Do you want to stay on a fixed-rate plan or opt for a Time-of-Use plan? As with any decision, it would be helpful to know certain factors to be able to make an informed choice. Some of the key factors to consider are your routine, lifestyle, available appliances, and energy storage.  

Consider your Daily Schedule 

Next, you can choose the pricing structure or available TOU plans that are right for you based on your household’s energy-use habits. This means that you can check if your schedule is flexible enough to shift the activities that require a lot of electricity to off-peak hours. For example, is it possible for you to plot your time to use your washing machine and do laundry during off-peak hours? TOU plans work best if you can time your tasks accordingly. 

Take Note of Your Smart Devices 

If you have smart devices or appliances that can be scheduled to run during off-peak hours then getting a TOU plan is beneficial for you. These devices can also be adjusted remotely which makes it more possible for you to align their use with the off-peak hours.  

Explore the Option of Getting Energy Storage Solutions  

What better way to maximize TOU plans and get more savings than by investing in an energy storage solution? Solar batteries can reduce your reliance on the grid because you can easily store energy during off-peak hours and use the saved-up energy during peak hours.  

Before signing up for the available TOU plans, it would be wise to consult with your service provider and ask questions or clarifications for you to determine the choice that best aligns with your lifestyle and financial goals.


Save More by using Solar Power Station

One of the main advantages of getting TOU plans is that you have the liberty to effectively lessen the cost of your electricity bill just by knowing about the different rates during specific times of the day. However, you should also consider whether your whole household is able to adjust and adapt in order to avoid using too much electricity during peak hours. For example, if there is only one out of five people in a home who uses appliances with a heavy electrical load during off-peak hours, you probably would not see any significance in terms of savings on your utility bill. This is where going solar might be more cost-effective.

Aside from utilizing TOU rate plans, you can get a solar power system equipped with batteries that can be recharge thru the grid during off-peak hours or thru solar to ensure that you are reducing your energy costs. Fortunately, Nature’s Generator’s Home Power System offers a starter kit all the way up to heavy-duty and longer-use options depending on your needs, preferences, and budget. This clean energy back-up can serve as your power source during peak hours which means you can draw your electricity from your own home solar system instead of relying on the grid. Going solar also means that you are eligible to avail of the Federal Solar Tax Credit which will further increase your savings, especially in the long run.  

Time-of-use rates coupled with a home solar system can help you save money on utility bills but it also depends on your location, the size of your solar installation, your energy consumption patterns, and the specifics of your utility's TOU rate structure. For best results, chat with a solar expert and reach out to your utility to see how these options can be customized to fit your needs.


* We want to give credit where credit is due. Professional writer, Shobe Cruz, contributed research and content to this blog titled: What is TOU Thank you, Shobe, for your contributions!