Knowing the difference between peak and off-peak electricity could make a huge difference to your electricity bill.

This article will help you understand what the different types of time-related electricity charges are, and how you can make sure you’re doing your best to lower your energy bill.

Why do peak and off-peak rates matter?

Your electricity bill is made up of a supply charge, which is a fixed, usually daily, charge you pay for access to the electricity from the grid, and a usage charge or rate, which is for the actual electricity that you use.

If you’re on a ‘single rate’ meter (which could be referred to as an ‘accumulation meter’ or ‘flat-rate’ meter), then you will be charged one flat price for the electricity that you use. 

If you don’t have a single rate meter, you may have what’s known as an ‘interval’ or ‘time of use’ meter or a smart meter.

When are peak and off-peak rates?

Peak and off-peak rates are defined by the time that electricity is used. 

Peak energy rates are charged when the electricity grid is likely to be used the most, like evening between 5 - 9pm. This is when people are likely to be at home, using appliances like the stove, oven, microwave or TV. With so many people doing this at once, it puts strain on the network. 

Off-peak rates are when households are less likely to be using energy. Energy companies, in an effort to get households to use electricity at quieter periods to reduce strain, charge electricity at a cheaper rate during off-peak times.

There are also shoulder rates - this is usually the time between peak and off-peak.

What’s the difference in cost between peak and off peak?

The difference in price between off-peak, shoulder and peak rates will depend on your energy provider, but it is important you check ahead of finalising any energy contract.

For example, an off-peak rate can be 20c, per kilowatt hour (kWh. However, peak rates could be 40c, or even 60c per kWh.. 

While that doesn’t seem like much, consider all the appliances you have in your home that are kept on throughout the day - it adds up!

Do all energy providers have the same peak and off-peak times?

While energy providers might follow similar patterns for peak and off-peak times, it’s worthwhile checking with your provider in particular to be certain. 

A common structure of peak, off-peak and shoulder times would be:

Time

Rate

11pm - 7am

Shoulder

7am - 4pm

Off-peak

4pm - 11pm

Peak

Using off-peak energy rates to reduce your electricity bill

Knowing when you are charged peak, shoulder and off peak rates will help you better understand your energy bill, and importantly, help you know what to do to reduce your bill.

Doing things like loads of washing or using the dishwasher during off-peak periods may help. If you’re unable to be home during off-peak times, use smart timers on your appliances so they can still run.

Are you on an energy plan that gives you the best rates for you?

Most households can choose from different kinds of energy plans to best suit their circumstances. 

If you’re interested in taking advantage of a plan that provides peak and off-peak rates, then it may pay to look at your options and see what could work for you.