What does Time-of-Use Rate (TOU) mean?

Explanation

Time-of-use rates mean electricity costs different amounts at different times. Typically, rates are highest during afternoon and early evening (when demand peaks), moderate during normal business hours, and cheapest overnight and on weekends. These rates reflect the actual cost of generating and delivering electricity at different times.

For EV owners charging at home, TOU rates are a significant money-saver. By using scheduled charging to shift your charging to off-peak hours (usually midnight to 6 AM), you can cut your per-kWh cost by 30-60% compared to peak rates. Some electricity providers offer EV-specific TOU tariffs with especially low overnight rates.

TOU rates also affect public charging prices, though indirectly. Charging operators pay wholesale electricity rates that vary by time of day, which is one reason some networks are introducing dynamic pricing that passes these time-based cost variations through to drivers.

For official definitions, visit OpenADR Alliance.

Where you'll see this

• In charging network apps
• On your charging receipt

Common confusion

TOU rates benefit EV owners most at home, where you control when you charge. At public chargers, the per-kWh price you see already reflects the operator's electricity costs, so TOU does not directly apply to your public charging bill.

Example

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