This article is your complete guide when solving the question, when is electricity cheapest? And the truth is learning the moving parts which factor into the cheapest time of day to use electricity is important when trying to become more energy efficient. In this article we’ll break down everything you will need to consider when trying to find the cheapest time to use electricity for your home or business. It’s even more important to understand these factors now as many suppliers are now offering time of use plans to their customers.
That includes a guide to electricity rates by time of day, if energy is cheaper at night and we will even break down when energy rates are at their lowest to renew your supply contract. We hope you find this article helpful, and if you would like to find out how you can save money on your next energy contract and become more energy efficient be sure to speak with us at the office at 888-836-9222 or chat with us on our website!
So if you’re ready to read about the cheapest time to use electricity read on!
When is Electricity Cheapest?
It’s important to keep in mind that there is both acheapest time of year and the cheapest time of day to use electricity. These times are when the demand for electricity prices are at the lowest and consumers can get the best deal and pay the lowest electricity price possible. The one important factor when trying to find the cheapest electricity is to understand how the electricity market is traded and sold.
Electricity rates by hour
Electricity consumption by residential customers and businesses are tracked and sold by on-peak electricity rates and off-peak electricity rates. These rates are set and tracked by the hour, so their will be a time of day when electricity is the cheapest.
What are the peak hours for electricity?
On-peak hours for electricity consumers are when residential and businesses are using energy the most. These hours will typically fall within the hours of the day when most people are up and working. The on-peak hours in New York City are 7:00 AM – 11:00 pm Monday – Friday.
What are the off-peak hours for electricity?
Off-peak hours are when demand for the commodity are at it’s lowest and will fall during the hours when folks are sleeping. In New York City off-peak hours are between 11:00 PM-7:00 AM Monday-Friday and 11:00 PM on Friday night until 7:00 AM Monday morning.
When is the Cheapest Time of Day to Use Electricity?
As you can probably have guessed, the cheapest time to use electricity is later in the evening or early morning. During which, there is less demand for electricity and thus costs a little bit less. And because nighttime tends to be the cheapest time of day to use electricity, it also makes for one of the best times to pull energy usage onto any battery panels that you have installed at your home or business.
What time is electricity the cheapest?
11:00 PM – 6:00 AM
This doesn’t necessarily mean that energy stays the same price during these hours above, or from the time the sun rises to when it sets. For example, it’s usually cheaper to use electricity early in the morning than it would be around 3-4 p.m. It’s important to keep in mind that specific off-peak electricity and on-peak electricity hours may differ depending on your location and electricity provider.
Time of Use Energy Plans For Your Business
So what is the best way to get the lowest energy prices? We’ll if you are willing to make some adjustments to the way you consume electricity and take advantage of energy efficient upgrades, a time of use energy plan might be a great fit for your small business. The great news is that many suppliers now offer time of use energy plans. In these plans, the amount you’ll pay will vary because it’s based on the time of day you consumed energy. While in a standard plan, you’ll (typically) pay the same rate regardless. This is a popular option for some commercial building owners who don’t mind running operations overnight when prices would be lower. However, sometimes these plans can cost you more in the long run. So as always, be sure to do your research and talk to your supplier before making any decisions!
You can save even more money with TOU energy plans by installing solar panels.When you send surplus solar energy back to the grid, your supplier will give you credits toward your energy bill.
When is the cheapest time of year to use electricity?
Demand for energy is at its highest during the summer and winter, and so the cheapest time to use electricity isduring the fall and spring. This is due to the increase in demand for air conditioning in the summer and for heat in the winter. Obviously, the amount prices fluctuate will depend somewhat on the climate of where you live.
Are electric rates higher in summer or winter?
This also depends on where you live. If you live in a state with colder winters and average summers, then electric rates would be higher in winter. However, on average in the US, electric rates tend to be a bit higher in the summer.
A good electricity rate depends on what state you’re located in. In states with lowest electricity rates, like Oklahoma, a cheap electricity plan would be under $0.07 per kWh (the average commercial rate). Whereas in New York, the average commercial rate would be double that. When you shop electricity rates, it’s always a good idea to know your state’s average rate per kWh.
Finding the best electricity plan
The best electricity plan may not necessarily come from the cheapest energy provider and rate. Always do your research and compare best electricity prices that fit the needs of your business. Your rate will depend on:
Type of energy source
Contract length
Whether you choose a fixed or variable rate
Time of year you’re signing up
Your energy supplier’s service charge
Any applicable state taxes/regulations
Occasionally, energy market rates may cause prices to dip or rise, which will also impact your kWh rate.
Factors that influence energy market rates
The most unpredictable factors that influence electricity prices are natural and accidental disasters. However, these both influence prices because they influence the driving force behind market rates: Supply and demand. When there’s some kind of disaster that causes a shortage of natural gas, for example, the cost of gas will then surge because the supply can’t meet the demand.
We can apply this same principle to the cheapest times to use electricity. The reason there are seasons and certain hours of the day where the demand for electricity is lower, so are your rates! So when is electricity cheapest?
What is the Best Time to Renew Energy Contract?
Generally speaking, the best time to renew your energy contract is in the fall or spring when demand is lower. A lot of business owners choose a fixed-rate plan so they can lock these lower prices in to avoid a price surge in peak months. It’s important to note that most energy providers will usually factor in the price difference when pricing your rate if your contract extends through those peak seasons.
So, to get the absolute cheapest electricity rates immediately, you’d probably need to choose a variable plan during the spring or fall. However, a fixed-rate plan usually results in more long-term savings. While you consider which option is best for you, be sure to also research your city and state’s energy market price trends. This can help you narrow down which time is the best time to renew your electricity contract.
When is the best time to find a new electricity provider?
The best time to find a new electricity provider depends on the current and future needs of your business. Although it never hurts to know your options and compare electricity prices, be sure to review your current contract if you’re considering breaking it. You may have an early termination clause. Additionally, while it may seem like you’re getting the lowest electric rates by choosing the variable rate, month-to-month electricity plans, you could actually be spending more in the long run.
Does your electric rate seem too high? At Aggressive Energy, our team of experts is here to craft an energy plan tailored to your specific needs. We’ll help you find the lowest electric rates possible and give you the tools you need to manage your energy use.
Which is the best electricity rate: Fixed or variable? In this article, we’ll define what’s a variable rate and what’s a fixed rate in terms of your energy cost. We will also examine the difference between variable and fixed rates. By listing the advantages and disadvantages of variable vs fixed rates, we hope to give you the information to choose the best electricity for your business.
What is Fixed-Rate Electricity?
In a fixed-rate electricity plan, your energy cost is paid via a fixed monthly fee. This means that even if market prices fluctuate, your rate plan won’t go up in price. Your fixed electric rate is the price per kilowatt-hour (kWh) you agreed to pay for throughout the length of your contract. Having a fixed rate protects you from cost increases that occur during peak seasons when energy demand is high. It also protects you from paying more as a result of volatile energy market conditions that occur as a result of an unpredictable outside factor, like a natural disaster.
What is Variable-Rate Electricity?
In a variable-rate electricity plan, the price you pay per kWh can change each month. Variable rates aredetermined by current electricitymarket conditions. Keep in mind, your energy supplier also has the ability to consider other factors outside of the current market that affect their supply rate. Energy cost changes often, which means your rates could too. When market prices drop, your rate can too. However, this works both ways, meaning your rate will go right back up when there’s a spike in temperature or demand. Basically, variable rates have the potential to get super cheap AND super expensive.
The Difference Between Fixed or Variable Rate
The key difference between variable and fixed rate is that the former can vary month to month throughout the duration of your contract, while the latter remains the same. However, it’s important to understand the advantages and disadvantages of both before deciding which is the best electricity plan for you. We weigh the pros and cons for both fixed or variable rates below.
Advantages of a Fixed Rate
Protection from price surges
Predictable costs
The advantages of fixed-rate energy plans stem from the fact that you have a predictable energy cost. Even if market prices surge, your rate will remain the same. This stability gives business owners the chance to plan a more accurate budget that’s easier to manage. This can create more savings more in the long run.
Disadvantages of a Fixed Rate
Your rate stays the same even when market prices drop
Usually have early termination fees
The disadvantages of fixed-rate energy plans are a result of the same factor that creates the advantages: Your price remains the same no matter what. Sometimes the market prices drop, but because you’re locked into a fixed rate, you won’t be able to take advantage of that. Even though there are long-term savings to be had as a result, your company only maximizes those benefits if you’re in a position to plan for the long term. This is partially because fixed-plan contracts are more likely to include an early termination fee.
Advantages of a Variable Rate
Potential to save when market prices are low
Usually don’t have an early termination fee
The advantages of variable-rate energy plans mainly revolve around their potential to avoid unnecessary costs. The demand for electricity fluctuatesnot only throughout the year, but even throughout the day. Variable plans allow you to take advantage of low prices instead of being stuck paying more. They also typically don’t have cancellation fees. This gives you the flexibility to switch providers if you find a better deal elsewhere.
Disadvantages of a Variable Rate
You pay more when market prices surge
Unpredictable costs
The disadvantages of variable-rate energy plans exist because of market volatility. If energy market conditions cause prices to rise, you’ll pay more than you would have with a fixed plan. This creates a huge potential for unpredictable costs, making it harder to budget. If your business isn’t prepared to pay an unexpectedly larger bill, this is a huge disadvantage.
Should I Choose Fixed or Variable Rate?
Whether you should choose a fixed or variable electricity rate depends on your business’s unique needs. It also depends on your energy provider and the terms they can offer. Unfortunately, there just isn’t a definitive yes or no answer we can give you to the question is fixed or variable electricity better without knowing more about your business. Here are some things to keep in mind to help you determine which plan is right for you.
A Fixed Rate is For You if…
You prioritize avoiding any financial risk
You’re located in an area with fluctuating weather or high/low temperatures
Your energy usage is about the same year-round
After this year, many companies aren’t in a position where they can afford to take on extra costs in their bills. Stable costs are important when it comes to managing a budget, especially if your business is still building or rebuilding its safety net. Fixed rates are also a good choice if you’re located somewhere where it gets really cold in the winter or really hot in the summer. This is because you’ll use more electricity to either warm-up or cool down than a state with more neutral temperatures. Most places with cold winters probably won’t have as hot of summers. So, if you’re powering an office building the same amount year-round, the amount you save during peak seasons could make up for any extra cost you pay when prices go down.
A Variable Rate is For You if…
You know how to stay up to date with the market
You’re financially stable
Your energy usage is different year-round
While it’s impossible to guarantee specific energy market conditions, it is possible to keep track of them and make predictions. It’s always important to choose your energy plan strategically, but especially if you’re choosing a variable-rate plan. This is because variable rates typically offer both greater risk and greater reward. If your energy usage is significantly less during a specific time of year, then there probably isn’t as much risk. Plus, because there isn’t an early termination fee, it’s easier to switch plans if you need to.
Keep in Mind
Usually, the pricing will eventually even out whether you choose a fixed or variable rate. If you have the time and resources to keep up with the energy market and can handle risk, a variable rate may be for you. Alternatively, if you’d rather have stability and minimize risk, a fixed rate is probably your best bet. Regardless of which you choose, be sure you’ve reviewed the terms of your electricity contract in its entirety before signing.
Still not sure which rate plan is for you? Having an energy provider you can trust to help you choose the best electricity plan for you makes your decision a whole lot easier. At Aggressive Energy, our team is committed to providing energy plans custom to the needs of your business. Contact ustoday to see how our energy solutions can serve you.