Time of Day Rates: Surge Pricing Coming in 2024

Understanding Time of Day + Time of Day Rates

Time of day (TOD) is a utility pricing system where the cost of electricity varies depending on the time of day. Currently, there is one flat rate during summer months, when usage is typically higher. Subsequently, during non summer months when usage is usually lower, rates are slightly lower as well. This approach encourages consumers to shift their energy consumption to periods throughout the day when electricity is less expensive. Electricity is usually less expensive during late nights or early mornings, these times are also known as off-peak hours. Understanding these rates is crucial for effective cost saving measures.

New Time of Day Rates

Consumers will face rate surges during peak months, typically known to be summer months (June, July, and August). Rates would remain most expensive during peak hours, or weekdays between 3:00 pm – 7:00 pm. This structure allows for lower rates for the remainder of the year.

Recently LIPA has created two new, lower rates: off-peak and super off-peak rates. Both are outside of the limited peak hours and are nearly half the cost, especially during non-summer periods. Off-peak hours span from 7:00 pm – 10:00 pm and super off-peak hours are from 10:00 pm – 6:00 am. This super off-peak rate offers an even larger discount to those who shift their usage to the late evening and early morning hours, and is especially beneficial to those with battery systems and EV owners who charge at home.

In 2024, LIPA (Long Island Power Authority) and PSEG LI plan to shift nearly all of its residential customers to these new electric rates, providing lower-cost electricity to customers during the off-peak hours of the day. New customers will automatically be enrolled, with existing customers following soon after. If, however, customers receive higher bills under the new rates than compared with their prior rate, LIPA will refund the difference.

How Does Time of Day Affect Me?

Time of day rates encourage a conscious shift in our energy consumption habits. For instance, according to an article posted to Newsday,  running your dishwasher or doing laundry during off-peak hours can lead to noticeable savings on your electricity bill. This approach not only offers financial benefits to your wallet but also promotes a more thoughtful, sustainable and efficient use of energy resources.

Benefits for Solar Owners 

For solar-equipped households, TOD provides an avenue to maximize the return on their investment. Solar owners are able to save money by using solar power during peak hours (3pm-7pm) and reverting to regular power use during off-peak hours. By aligning their energy usage with solar production and TOD rates, solar owners can optimize self-consumption and potentially even sell excess energy back to the grid during peak hours. 

Benefits for Battery-Only Owners

Similarly, having batteries installed in your home can save you hundreds of dollars by charging from the grid during off peak or super off peak times and be used to power homes or electric vehicles during times of day when rate is highest.

Benefits for Solar + Battery Owners

For solar and battery enthusiasts, time of day isn’t just a utility pricing strategy; it’s a game-changer for maximizing the benefits of solar energy and battery storage. The key lies in smart utilization and storage. During periods of abundant sunlight, solar panels generate excess energy and batteries store this excess energy. With TOD, homeowners can harness this surplus power strategically. Cutting-edge solar storage solutions, like batteries, enable the collection and retention of surplus energy during low-cost periods. As the sun sets or during times of increased energy demand, stored solar power can be accessed, offsetting the need for grid-supplied electricity and bypassing the need to pay for that electricity at peak rates. This not only enhances the efficiency of solar installations but also empowers homeowners to further reduce their reliance on conventional energy sources during expensive peak hours.

Benefits for Electric Vehicle (EV) Owners 

Look forward to saving extra money with TOD rates by charging your electric vehicle primarily during off-peak or super off-peak hours compared to charging your EV during peak hours.

Benefits for All Ratepayers

Time of day rate benefits reach beyond solar and/or battery owners, it benefits all. There is an enormous positive environmental aspect when following and implementing TOD rates. Firstly, by choosing to redirect high electricity chores (e.g. running the washer/dryer, dishwasher, heater) during super off-peak/off-peak hours would not only save you money but help lessen strain on the electric grid and, in turn, help the environment and sustainability efforts by lowering emissions typically generated during peak demand. 

Financial Benefits: How to Save Money with TOD Rates

Solar and storage specifically provide paths to maximize savings. For example With TOD you can save extra money by load shifting and EV charging. Households can also leverage programmable appliances, smart thermostats, electric vehicle charging and other energy management tools that can contribute to substantial savings over time. Overall, the financial benefits of TOD pricing become apparent when consumers strategically schedule energy-intensive activities during off-peak/super off-peak hours.

Plan Now for TOD Changes

Our expert team will help you analyze the impact of time of day rates and help you make the most of cost benefits. Book a consultation today to maximize your savings in the new year.