Can off-peak energy plans reduce your electric bill?

I signed up for my electric provider’s off-peak “time of use” energy pricing plan to see if it really does save me money.

Electricity is expensive these days. Would you disagree?

In my home city of Portland, OR both electricity providers (PGE and Pacific Power) have raised rates and petitioned the local government to raise them more. For example, regulators just approved a nearly 10% increase in rates for this year. PGE customers in particular have seen a 43% rise in their electric rates in the last 3 years. I would imagine that Pacific Power is much the same.

(And if you have gas, ditto all this with your gas provider.)

I generally think that you should pay what it takes to make your home comfortable. but I also don’t believe in spending unnecessarily. And this got me to thinking that maybe the answer isn’t to try to cut down on your energy usage per se, but rather, change when your usage is.

Time of use

In Europe, I think it’s more common to have varying rates for your electricity based on the time of day. But not really in the U.S.

And I think this sort of system makes a lot of sense. When there is a lot of demand, prices should vary to mitigate that demand, so as to stabilize and smooth out the supply.

Toll roads in many places vary the amount of the toll depending on the time of day, thus encouraging people to drive off-hours and reduce congestion. Why not do the same thing with power?

Pacific Power’s options

I went looking for this on my energy provider’s website. Pacific Power, it turned out, does offer an on/off-peak pricing plan for residential, called Time of Use.

(Okay, weirdly, when I set this up months ago, there were two different plans with slightly different details on what was considered peak and what kind of savings. But as I looked today, only a single option is available, which thankfully is the one I chose. So this whole section is a lot simpler than I expected it to be.)

The peak time is very simple: every day, 5-9 PM. Everything outside that is off-peak.

The rates they quoted were 28 cents/kWh for on peak and 10 cents/kWh for off peak.

I looked at my bill, and saw that my current rate was around 14 cents/kWh. So this seemed certainly worth pursuing.

If I could reduce my energy consumption for those measly four hours each day, it seemed like I could certainly reduce my costs. I signed up.

Waiting for the (meter) man

Unfortunately, this wasn’t as simple as clicking a button. I had to call to set this up, and then Pacific Power needed to come out and install a whole new meter. That took months, and plus I think I got lost in the system for a while. Since there wasn’t a way a way to check if I had moved over to this new rate schedule except by calling or waiting for my bill, this wasted a lot of time and I called so often I knew the phone tree by heart.

Thankfully, everyone was very nice when I called. But all in, it took around four months to get this set up properly.

My takeaway from this is that this isn’t something that Pacific Power really wants people to know about or sign up for. If they did, we would be barraged with ads about it, and they’d make it simple to sign up.

Contrarily, that made me confident that my decision was a good one. After all, if we agree that if a company advertises something then you don’t need it, then if they don’t advertise something, perhaps that’s because it benefits you more than them.

Peak time

So what are the things I do at home that use a lot of energy?

  1. Washer/dryer. This was easy, as I can do laundry at other times during the day.
  2. Dishwasher. Ditto.
  3. Shower. I’m a morning showerer, so this was easy as well.
  4. Stove. This was a little trickier, but I could (and did) sometimes move to having an earlier (or later) dinner at times when it made sense.
  5. Heat. I’m still experimenting with this one, but I’ve been trying out cranking the heat right before 5 PM, and then letting it ride for a while, turning the heat back on a little while later. It usually works fine.

Only four hours of peak time is a very promising schedule. That said, if you use most of your energy between 5-9 PM, you’re going to pay a lot more.

My results

I recently got my first month’s bill with Time of Use, and I wanted to share my findings with you.

To really do an accurate comparison, I’m going to compare this year with last year’s bill at this exact time.

January 2024
Usage: 873 kWh
Total: $121.72
Effective rate: 13.9 cents/kWh

January 2025
Usage: 726 kWh
Peak: 48 kWh
Off-peak: 678 kWh
Total: $95.83
Effective rate: 13.2 cents/kWh

How much would my bill have been if I hadn’t done Time of Use? Assuming I didn’t change my behavior at all, my cost would have been $101.22, or about $5.39 higher. So I saved about 5%.

I particularly like how my bill calls out the on-peak and off-peak pricing surcharges/credits.

Reflections on off-peak pricing

So that was my result for just one month. Understandably, I was hoping that my savings would be more than it was. How cool would it have been to save 25% on my electric bill?

But hey, 5% is not nothing. And in these straitened times, if you can set something up that will save you money and have it not be too onerous to execute, then you might as well.

So on balance, I’m still happy with Time of Use, and plan to keep on using it. (Which is just as well, as there’s a 12 month commitment.)

Also, and this is just between you and me, but the savings differential might increase over time. I spoke to a Pacific Power rep who noted that this rate schedule doesn’t change in lockstep with regular rates, so when regular rates rise, these rates may not.

But besides all that, using electricity during off-peak periods helps alleviate the strain on the power grid (I’m looking at you, Texas), and so it contributes to a more stable energy supply for everyone. That sounds good to me regardless of the savings.

Please share this post:
Comments are closed.