Time-of-Use Rates: Automate the Cheap Hours

Prices and rates in this article were checked October 2026.

Section 1: Why does the same electricity cost more at 4 p.m.? (Introduction)

Time-of-use rates charge more at peak hours and less off-peak, so the saving comes from moving load, not from using less. Shift laundry, dishwashing, water heating and EV charging, automate the shift, and check whether your utility charges more for peak use.

Most people think of electricity as one price. The bill arrives, the total is divided by the kilowatt-hours, and that average becomes “our rate.” Time-of-use pricing breaks that assumption. The price per kilowatt-hour changes by the hour, and the evening hours usually cost the most.

That makes the clock an input to your automation system, alongside motion, temperature, and the sun. A dishwasher that runs at 8 p.m. and one that runs at 11 p.m. use the same electricity and cost different amounts. A thermostat that pre-cools before the peak and coasts through it uses the same energy at a lower price.

This guide covers how the rates are structured, the arithmetic that decides whether shifting is worth the trouble, which appliances are good candidates, and how to automate the shift without turning your house into a spreadsheet. For the wider picture, start with the Automation hub.

Section 2: How do time-of-use rates actually work?

A time-of-use plan divides the day into periods and assigns a price to each. The details vary by utility, but the shape is consistent:

• Peak is the expensive window, usually late afternoon and early evening, when demand is high and solar production is falling.
• Off-peak is the cheap window, typically overnight and in the middle of the day.
• Partial-peak sits between them on plans that use three tiers.
• Seasons change the prices, and sometimes the hours. Summer afternoons are usually the most expensive.
• Weekends and holidays may be treated differently. Some plans drop peak pricing entirely on weekends; others keep it every day.

The national baseline is useful for scale. The EIA put the U.S. average residential price at 18.16 cents per kilowatt-hour in August 2026. A time-of-use plan in a high-cost state can be far above that, and the spread between peak and off-peak is what matters.

A real example

PG&E’s E-TOU-C plan, effective June 1, 2026, prices peak hours as 4 to 9 p.m. every day. In summer, the total bundled rate is about 52.2 cents at peak and 39.9 cents off-peak. In winter it is about 39.8 cents and 36.8 cents. Those numbers include generation and delivery, before baseline credits and fixed charges.

Notice two things. First, the peak window is every day, including weekends, which is not universal. Second, the winter gap is only about three cents. The plan’s savings depend heavily on the season, which is why a summer month can look great and a winter month can look flat.

Flat rates and default plans

Not every household is on a time-of-use plan. Many utilities still offer a flat rate, and some customers are moved to time-of-use when they add solar, an EV charger, or a smart meter. The first step is not automation; it is reading the plan name on the bill and checking whether the utility offers a comparison tool. A plan switch is a bigger lever than any schedule, and it costs nothing but a phone call or a web form.

If you are on a flat rate and the utility offers time-of-use, run the comparison with a year of usage data, not a summer month. The plans are designed so that the average customer pays about the same; the winners are the ones whose load is flexible. If your evenings are a wall of cooking, laundry, and air conditioning, the flat rate may genuinely be cheaper.

Why utilities do this

Peak pricing is a signal. Building enough generation and wire to serve a few hundred hours of annual peak is expensive, and shifting demand away from those hours reduces the need. A smart home is unusually good at responding to the signal, because the devices can move load without anyone standing at the appliance.

Section 3: Does shifting load really save, and how much?

The headline peak price is not the number that decides whether shifting pays. The delta is.

Take the PG&E summer example. The gap between peak and off-peak is about 12.3 cents per kilowatt-hour. If you move 10 kWh out of the peak window — a load of laundry, the dishwasher, and an hour of EV charging — the saving is:

10 kWh × $0.123 = $1.23 per day.

Over a 30-day month, that is about $37. Over a four-month summer, roughly $148, if you shift the same amount every day. In winter, with a three-cent delta, the same shift saves about 30 cents a day, or $9 a month.

That is the honest scale. Time-of-use automation is not a windfall; it is a steady, unglamorous discount for people who can move flexible load. The households that save the most are the ones with an EV, a heat pump water heater, a pool pump, or all three, because those loads are large and genuinely flexible.

Two ways the math goes wrong

• Shifting without reducing. Running the dishwasher at 11 p.m. instead of 8 p.m. saves money only if the rate difference is real and the appliance actually waited. A delay button that does not work, or a schedule that starts at 8, captures nothing.
• Chasing the peak price with a fixed charge. Some plans pair lower usage rates with higher fixed charges or a base services charge. Compare the whole bill, not the cents per kilowatt-hour. A plan that looks cheaper per kWh can cost more if your usage is low.

The other trap is comfort. Pre-cooling a house before a peak works in a dry climate with decent insulation. In a humid climate, or a leaky house, the house warms back up before the peak ends and the air conditioner runs at the expensive rate anyway. Test it for a week before you build a schedule around it.

Section 4: Which loads should you move, and which should stay put?

The best loads are large, flexible, and indifferent to the clock.

Good candidates

• EV charging. The biggest lever by far. Most cars sit for twelve hours overnight; schedule the charge to start after the peak ends. A 40 kWh charge moved from a 12-cent delta is nearly $5 per session. Check whether the utility has a separate EV plan with a longer off-peak window; the right plan can matter more than the schedule. If you are still choosing hardware, the smart EV charger roundup compares the models that schedule reliably.
• Dishwasher and laundry. Both have delay-start functions, and both can run overnight. The dryer is the larger load; if it is a heat-pump dryer, it is also gentler.
• Heat-pump water heater. A tank is a battery for hot water. Heat it during off-peak hours and let it coast through the peak. The best smart water heaters roundup covers the models whose schedules can do this.
• Smart thermostat. Pre-cool or pre-heat before peak arrives and let the house coast through it; a schedule or geofence does the shifting without anyone touching the wall. The smart thermostat roundup compares four models.
• Pool pump and dehumidifier. Big, dumb, and schedulable. A pool pump is often the second-largest load in the house after HVAC.
• Pre-cooling or pre-heating. Use the thermal mass of the house instead of the compressor during peak. This is where a smart thermostat earns its price.

Poor candidates

• The refrigerator and freezer. They cycle on their own and should stay cold. Do not put them on a schedule to save a few cents.
• Medical equipment and anything with a battery that must stay charged. Reliability beats rate optimization.
• Cooking during the peak. Dinner is at 6 p.m. for most households, and the oven is a resistance heater. Unless you have an induction cooktop and a flexible schedule, this is not worth moving.
• Comfort in extreme weather. A heat wave is not the time to test a clever setpoint. Keep the safety margins, and let the automation pause.

The pattern: shift the loads that store energy — hot water, a car battery, a pool, a pre-cooled house — and leave the ones that need to respond in real time alone. The storage is what makes the shift possible.

Section 5: How do you automate the shift without creating new problems?

You do not need a full home automation system to act on a time-of-use rate, but the system makes it consistent.

The minimum viable version

1. Find your rate plan and its peak window. It is on the utility’s website and usually on the bill.
2. List the five largest flexible loads. An energy monitor or a few smart plugs will tell you which they are.
3. Set the delay or schedule on each appliance for the off-peak window.
4. Move one load at a time and compare two bills. Do not change five things and guess.

The automation version

• Thermostat schedule. Pre-cool to a comfortable setpoint an hour before peak, then raise the setpoint during peak. ENERGY STAR notes that heating and cooling are almost half of the average household’s energy bill, more than $900 a year, so a degree or two matters more than it sounds.
• Smart plugs with energy monitoring. Put them on the dehumidifier, the pool pump, or the space heater, and schedule by time. The monitoring is the useful part; it tells you whether the load is worth automating.
• Appliance integrations. Some washers, dryers, dishwashers, and EV chargers expose a “delay start” or a schedule to the vendor app, and some expose it to Matter or a local hub. A schedule that lives in the appliance is more reliable than one that depends on a cloud service.
• A rate-aware dashboard. Home Assistant’s energy dashboard, or the utility’s own hourly view, turns the abstract rate into a graph. Watching the peak band fill with usage is the best motivation to move a load.
• A guardrail. If the automation raises the thermostat during peak, it also needs a rule that restores comfort if the indoor temperature crosses a limit, or if someone presses a button. An automation that makes the house uncomfortable gets disabled, and then it saves nothing.

The most valuable automation is boring: a schedule that starts the dishwasher at 10 p.m. and the car at 11 p.m., every night, without anyone thinking about it.

When the network is down

A time-based schedule should live in the device, not in the cloud. An appliance with a delay-start button keeps working when the Wi-Fi does not; a cloud schedule does not. For the thermostat, a local schedule plus a manual override is the reliable pattern. If the hub is the only thing that knows the rate window, an outage turns the cheap hours back into expensive ones.

Keep a written note of the peak window on the fridge for the first month. It sounds silly until a guest runs the dryer at 5 p.m. and someone has to explain the rate plan.

Section 6: How do you test whether the shift pays in your home? (Conclusion)

1. Read the rate plan. Write down the peak window, the seasons, and the delta between peak and off-peak.
2. Find the big loads. The EV, the water heater, the pool pump, the dryer. Those are where the money is.
3. Shift two of them. Not five. Two, with a schedule you will actually leave alone.
4. Measure for a month. Compare the bill and the hourly usage graph. If the saving is not there, the load was not as flexible as you thought.
5. Automate the rest only if the first two worked. Then add the thermostat pre-cool and the appliance schedules, with a comfort guardrail.
6. Review the plan each season. Rates change, and so do the hours. A schedule built for summer may be shifting load into a winter peak that no longer exists.

Some households should not bother. If you are on a flat rate, if your utility’s peak and off-peak prices are nearly identical, or if your usage is already low, the savings may not cover the time you spend setting it up. The plan is worth it when the delta is large and the flexible load is big — an EV in a high-cost state is the clearest case.

Time-of-use pricing rewards the household that can wait. A smart home’s real advantage is not that it can wait; it is that it can remember to, every day, without being asked.

Where to buy

Related reading

• The Smart Home Energy Audit — find the load before you shift it.
• Presence-Based Automations — the other input that changes the schedule.
• Automation Fail-Safes — what happens when the schedule meets an outage.
• Smart Plugs 101 — the cheapest way to put a load on a timer.

Sources

• EIA: Electric Power Monthly, Table 5.6.A — U.S. average residential price of 18.16 cents per kWh in August 2026, checked October 2026
• PG&E: E-TOU-C tariff — summer 52.240 and 39.940 cents, winter 39.757 and 36.757 cents, 4–9 p.m. peak, effective June 1, 2026
• PG&E: Time-of-Use Rate Plans — peak windows, daily and weekend structure, shifting guidance, checked October 2026
• ENERGY STAR: Smart Thermostats — heating and cooling near half of the energy bill, more than $900 a year, checked October 2026