Time-of-Use vs. Flat Rate Plan
A time-of-use plan charges different rates by time of day, cheaper off-peak, pricier on-peak, instead of one flat rate all the time. Whether it saves you money depends entirely on when you actually use electricity, not on the plan itself.
At your inputs, the time-of-use plan costs $3,000 less over 10 years.
| Flat rate plan total cost over the horizon | $22,000 |
|---|---|
| Time-of-use plan total cost over the horizon | $19,000 |
Breakeven: The higher upfront cost is offset by year 0.0, after which the time-of-use plan stays cheaper.
- This uses planning estimates you entered, not a contractor quote or guaranteed savings.
- A lower calculated cost depends on your actual usage timing, which this tool does not verify against your real bill.
What this also tells you: Even if your annual costs are 20% higher or lower than entered, the same option stays cheaper, with the advantage ranging from $2,400 to $3,600.
This is a planning estimate based on your entries. It does not size equipment, determine electrical or building-code compliance, verify incentive eligibility, or replace a contractor quote or professional energy audit.
Why this decision comes up
Utilities increasingly push customers toward time-of-use plans, and the pitch is not always honest about the households for whom it would actually cost more.
How this is calculated
Both paths are compared as total cost over your ownership horizon: net cost plus annual cost carried forward, using your own entered usage-pattern-adjusted estimates for each plan.
A worked example
With the defaults (flat rate: $0 net cost, $2,200/year; time-of-use: $0 net cost, $1,900/year; 10-year horizon), time-of-use totals $19,000 against $22,000 for flat rate, a $3,000 advantage for time-of-use at these defaults, assuming a favorable usage pattern.
Common mistakes
A common mistake is assuming time-of-use always saves money without checking your actual usage timing against the plan's specific peak and off-peak windows.
Limitations
This does not analyze your actual hourly usage data. Your utility's own usage portal, if available, gives a more precise basis for your entered annual cost estimates.
Common questions
How do I know if time-of-use would save me money?
Check what share of your usage already happens during off-peak hours, typically overnight, using your utility's usage data if available. A household that already uses more power overnight (EV charging, for example) is more likely to benefit.
Can switching plans ever cost more?
Yes, if most of your usage happens during peak hours, a time-of-use plan can raise your bill compared to staying flat. This is a real risk this comparison is meant to help you check before switching.
Is switching usually free?
Often yes, though some utilities have restrictions on how often you can switch. Check your utility's specific policy.
Does adding an EV or battery change which plan is better?
Often yes, both shift usage patterns in ways that can make time-of-use more favorable, EV charging overnight or a battery discharging during peak hours. Re-run this comparison if you are adding either.
How often do utilities revise their time-of-use windows?
Utilities periodically adjust peak and off-peak hours and rates, sometimes in response to grid conditions. A plan that saves money today could look different after a revision, so it is worth rechecking periodically.