Time-of-use electricity pricing for solar homes
Time-of-use rates charge different prices for electricity at different hours, and they change what solar is worth because panels produce most at midday while many homes use most in the evening. How much it matters depends on whether your utility applies time-of-use pricing to exports as well as to imports.
What are time-of-use rates?
A time-of-use plan divides the day into periods, commonly off-peak, mid-peak and on-peak, with a different price per kilowatt-hour in each. Some utilities offer these plans as an option and some apply them by default; others have no residential time-based pricing at all. Schedules, seasons and prices are set by the utility or regulator and change from time to time, so look at your own bill and your utility's rate page for the current periods.
The idea behind the design is to move demand away from hours when the grid is stretched, by making those hours dearer.
Peak hours are the periods with the highest rates, and off-peak hours the lowest. Time-of-use rates reward homes that use electricity during off-peak hours and avoid peak hours, and the utility often publishes the hours for weekdays, weekends and holidays separately. For homes with solar panels, the peak and off-peak hours matter for both the use of power and the energy storage decision, so note when your own use peaks.
How do time-of-use rates affect solar savings?
Solar output peaks around midday and in summer, while household demand often peaks in the morning and evening. If the midday period is cheap and the evening period is dear, each kilowatt-hour your panels make at midday displaces cheaper power than you buy in the evening. With flat rates, that mismatch does not matter. With time-based rates it can lower the value of the exports, depending on how the utility credits them.
A simple illustration with assumed values: a home exports 10 kWh at midday and imports 10 kWh in the evening. If the credit is one for one in energy terms, the bill is zero for the energy. If the credit is priced at the midday rate and the import is priced at the higher evening rate, the bill is positive, even though the kilowatt-hours match. The net metering guide explains the credit methods, and the electricity rates and solar savings guide covers flat-rate cases.
Can a battery help with time-of-use pricing?
A battery can store midday solar power and release it in the evening, moving energy from the cheap period to the dear one. Whether that earns its cost depends on the price gap between periods, the battery's price and the rules for exports. In many homes the gap is not large enough to repay a battery on its own, and the case rests on backup power too. The solar battery storage guide and the cold weather battery guide describe what storage can and cannot do.
Can you shift your own use instead?
Often yes, and for no extra equipment cost. Running the dishwasher, laundry or an electric vehicle charger at midday uses solar power as it is made and avoids evening charges. A heat pump water heater or a programmable thermostat can pre-heat the home or the tank during sunny hours. The heat pump water heater guide and the smart thermostat savings guide show two tools. Track the results with the advice in the solar monitoring guide.
What should you check before choosing a plan?
Ask your utility whether time-of-use pricing is optional, how exports are credited under that plan and when the periods change with the season. Compare a year of your own interval data under the flat and time-based plans if the utility lets you. If you have not yet installed solar, ask the installer to model your production against the time-based schedule, not just against an average price. Check the current rules and rates directly with the utility or the provincial regulator.
Quick answers
Are time-of-use rates good for solar owners?
It depends on the schedule and on how exports are credited. Some homes gain by shifting use to sunny hours, and others lose when evening prices are high.
Does solar production line up with on-peak hours?
Partly. Panels produce mostly at midday, while on-peak periods are often in the morning and evening, so alignment varies by season and schedule.
Do I have to join a time-of-use plan if I install solar?
It depends on the utility. Some make it optional and some apply it by default, so ask before signing a contract.
How can I use more solar power myself?
Run flexible loads such as laundry, dishwashers and car charging at midday, and use timers or smart controls where you can.