What a time-of-use rate actually is
A flat tariff charges the same per kilowatt-hour whenever you use it. A time-of-use tariff divides the day into periods — typically off-peak, mid-peak and on-peak — and charges differently in each. The peak window is usually late afternoon into evening, when everyone gets home and air conditioning, cooking and laundry coincide.
The ratio between peak and off-peak varies enormously by utility, from about 1.5:1 to more than 4:1. That ratio is the only number that decides whether shifting your usage is worth any effort at all, and it is on your rate schedule rather than your bill.
What is worth shifting
The test is simple: can the load be moved in time without anybody noticing? If yes, and it is large, shift it. If it has to happen when it happens, no tariff will change that.
Annual costs at the flat US average of 18.34¢/kWh, for scale. On a time-of-use tariff the shiftable rows are the ones where that number can be reduced without changing anything you do.
| Load | Shiftable? | Notes | A year |
|---|---|---|---|
| EV charging (Level 2 home) | Yes — completely | The single best candidate. The car does not care when it charges, only that it is full by morning. | $649 |
| Electric water heater | Yes — mostly | A tank stores heat. Heating it off-peak and coasting through peak works, and needs only a timer. | $499 |
| Electric clothes dryer | Yes | Nothing about a dryer requires it to run at six in the evening. | $125 |
| Dishwasher | Yes | Most have a delay-start button that nobody uses. | $45 |
| Pool pump | Yes — completely | Filtration only needs a certain number of hours a day, not particular hours. | $396 |
| Hot tub | Partly | The setpoint can be dropped through peak and recovered off-peak, if the controller allows it. | $602 |
| Central air conditioner | Partly | Pre-cooling before peak and coasting through it works in a well-insulated house and not in a leaky one. | $421 |
| Electric oven | No | Dinner happens at dinner time. | $62 |
| Refrigerator | No | It runs when it runs. | $77 |
| LED television | No | Peak hours are exactly when people watch television. | $31 |
The arithmetic of pre-cooling
Pre-cooling means running the air conditioning hard before the peak window and letting the house drift up through it. It works because a building is a thermal store — but only if it is a good one. In a well-insulated house the temperature rises slowly and you coast through four hours comfortably. In a leaky one it rises within the hour and you end up running the system during peak anyway, having also paid to over-cool beforehand.
The honest test is empirical and costs nothing: on a hot day, switch the cooling off and time how long the indoor temperature takes to rise three degrees. Under an hour and pre-cooling will not work for you. Over three and it will.
Should you switch to a time-of-use tariff at all?
It depends entirely on your shape, not your total. Two households using identical kilowatt-hours can end up hundreds of dollars apart on the same tariff.
- Good fit: an EV, an electric water heater, a pool, nobody home during the day, or a willingness to run laundry at night.
- Poor fit: someone home all day in a hot climate, electric cooking at conventional meal times, and no large shiftable load.
- Check first: most utilities publish your own interval data. Download a month of it and see what fraction of your usage already falls in the peak window — that single number answers the question better than any rule of thumb.
A worked example
A household with an EV, an electric water heater and a pool, on a tariff charging 32¢ at peak and 11¢ off-peak — a fairly typical 3:1 spread.
Illustrative rates, real consumption figures from this site. The water heater is shown at 80% shiftable because a tank cannot coast through every peak period.
| Load | A year | All at peak (32¢) | Shifted off-peak (11¢) | Saved |
|---|---|---|---|---|
| EV charging (Level 2 home) | 3,541 kWh | $1,133 | $390 | $744 |
| Electric water heater | 2,720 kWh | $870 | $413 | $457 |
| Pool pump | 2,160 kWh | $691 | $238 | $454 |
| Electric clothes dryer | 682 kWh | $218 | $75 | $143 |
| Dishwasher | 244 kWh | $78 | $27 | $51 |
| Total | $1,849 |
Nothing in that example requires anyone to change how they live. The car charges overnight because it was told to, the water heater runs on a timer, the pool filters at night, and the dishwasher gets a delay-start pressed once. That is the realistic upper end of what tariff optimisation is worth — substantial, and entirely mechanical.
Why this site quotes a flat rate
The EIA publishes average revenue per kilowatt-hour by state, which is a blend across every customer and every tariff. It is the right figure for comparing states and for costing an appliance in general terms, and it cannot see time-of-use pricing at all. If you are on a time-of-use rate, use your own peak and off-peak numbers in the calculators here — the arithmetic is the same, only the price changes. How to get your effective rate off a bill is here.
Questions
Is a time-of-use tariff cheaper?
What should I run at night on a time-of-use rate?
Does pre-cooling my house actually work?
What is a demand charge?
All guides · How the figures are computed · Break down your own bill