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What are Time of Use (ToU) tariffs and their benefits?

A Time of Use (ToU) tariff offers you at least two different prices for the energy you use at different times in a day.

What are Time of Use (ToU) tariffs?

Households on time-of-use (ToU) tariffs get cheaper energy prices when demand is generally low. ToU tariffs have at least two different prices for the energy you use depending on the times of the day. Some ToU tariffs also have a third, ‘peak’ rate, which encourages users to avoid using energy at busy peak times when demand on the grid is high.

The idea behind ToU tariffs is to balance demand out across each day, reducing spikes in energy demand in the early evening.

NOTE: You will need a smart meter to get a ToU tariff from most suppliers. A smart meter automatically sends information about when you’re using energy to your supplier.

Lower prices associated with ToU tariffs mean households are encouraged to use more energy when demand is lower. Shifting demand into quieter times supports a greener electricity system as it avoids the need to switch to more polluting fossil-fuel based generation, traditionally used to cover the normal daily peaks in demand.

Because electric vehicles (EVs) use a lot of energy, and their charging can easily be delayed, many Time of Use (ToU) tariffs are only offered to EV owners and marketed as EV tariffs.

What are the benefits of Time of Use (ToU) tariffs?

There are a number of benefits to having a Time of Use (ToU) tariff. They include:

  • Help you to lower your bills by using energy at off-peak times when energy is cheaper.
  • Enable you to get your home energy from greener sources as they avoid the need for energy to be generated by carbon-emitting fossil-fuel based sources.
  • Helps you to play your part in relieving pressure on the UK energy infrastructure and assisting in the transition towards renewable sources.