When is the Cheapest Time to Use Electricity?
Trying to figure out how to find the best electricity rates and the cheapest electric company? Learning the cheapest time to use electricity is a great place to start! In this article, we’ll fill you in on the cheap electricity times and how to get cheap electricity prices.
Read on to learn when electricity is cheapest!
What is a Good Electricity Rate?
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?
Cheapest Times to Use Electricity
There is both a cheapest time of year and the cheapest time of day to use electricity. These times are when the demand for electricity prices is at its lowest.
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 is during 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.
When is the cheapest time of day to use electricity?
Just like peak energy consumption seasons, there are peak energy consumption hours. During which, demand for electricity is greater and thus costs a little more. For the most part, peak hours are during the day, which makes night the cheapest time of day to use electricity.
This doesn’t necessarily mean that energy stays the same price 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. We say “usually” for all of the above because specific peak hours may differ depending on your location and electricity provider.
Time of use energy plans
Some providers 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 provider before making any decisions!
You can save even more money with TOU energy plans by using solar panels. When you send surplus solar energy back to the grid, your provider will give you credits toward your energy bill.
Related post: Energy Conservation Tips to Reduce Business Expenses
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.
Contact us today to learn how we can work for you!