Time Of Use (TOU) tariffs apply different prices for electricity at different times of the day. Time is divided into Peak, Shoulder and Off-Peak periods which reflect the level of demand on the electricity network. During Off-Peak periods electricity prices will be cheaper than at other times.
Under the National Electricity Rules, electricity networks (the ‘poles and wires’) must be built to handle the maximum peaks in demand. This means that network tariffs must reflect a combination of the total electricity being used and the peak rate at which it is being consumed. When customers run a lot of equipment or appliances such as pumps, refrigerators, air conditioners or processing plant at the one time, they increase the peak demand on the network. The more efficiently a customer uses electricity, the less impact they have on the electricity network. Therefore, TOU tariffs are a more cost-effective way of setting prices for customers than standard flat rate or block tariffs.
Essential Energy’s Time Of Use tariffs
We offer a range of tariffs that have been designed for different types of customers, considering their energy consumption and/or demand profile, voltage level and type of connection to the network.
To take advantage of TOU tariffs you will require a time of use capable meter. Most of our residential and small business customers have basic accumulation meters so you may need to pay for a meter upgrade and allow time for your meter to be replaced.
Customers with a basic interval or time of use capable meter can choose to move to a TOU tariff at any time. Charges vary with the time of day in which consumption occurs. There are three periods for TOU pricing: Peak, Shoulder and Off-Peak. Generally, prices are highest in Peak times and lowest in Off-Peak times.
How to reduce your charges
Charges are higher in Peak and Shoulder times and lower in Off-Peak times, so understanding the way you use electricity and the available tariff options is important to ensure you get the best value for money.
Typically, customers should aim to use electricity at lower cost (Off-Peak) times in order to save on their electricity charges. The amount you’re able to save depends on your ability to change your consumption patterns, or shift your consumption to these lower cost time periods.
Usage patterns also tend to change over time, so reviewing these on a regular basis will help you get the best deal for your business needs. You may also be able to reduce your charges by applying energy efficiency measures. Eligible customers can receive assistance through the NSW Government’s Energy Saver program. To find out if you are eligible, phone 1300 361 967 or visit environment.nsw.gov.au
How is my electricity measured on a time of use basis?
Once your TOU capable meter is up and running your consumption of electricity within each Peak, Shoulder and Off-Peak period is measured.
If you consume more than 100MWh per annum, you are required under the market rules to have an interval meter installed. These meters are electronic and record your usage remotely, in 30 minute intervals.
For more information
Download our Time Of Use fact sheet which contains more detailed information around tariffs and case studies of different scenarios for comparison.
You should contact your retailer to discuss the best tariff for you and make any requests for tariff changes.