Free Nights Electricity Plans: Gimmicks Disguised as Savings

What are the pros and cons of free nights electricity plans?

In this article, we examine a couple of the most popular energy plans on the market in Texas: free nights energy plans.

Here’s the big question: Do free nights electricity plans help save you money on your energy bills?

The answer? Probably not, with a few exceptions.

Let’s dig in further.

Pros of Free Nights Electricity	Cons of Free Nights Electricity
Free Energy Charge at night	Extremely high Energy Charge during the day
Energy savings if you can shift the majority of power consumption overnight	Shifting the majority of energy consumption overnight is very difficult in Texas
Good solution for homeowners with solar panels	Solar panels only work efficiently on sunny days

Pros of free nights electricity

Free energy charge at night

The word “free” certainly captures a lot of attention when shopping for electricity, and these plans hold true to the name.

When you examine the Electricity Facts Label before enrolling, you’ll find that you will have a reduced or free Energy Charge at night (usually from around 9 PM to 6 AM).

That means for all of the kilowatt-hours of power you consume during the free window at night, your Energy Charge is 0.

However, it is worth noting that the TDU delivery or pass-through charges from your regional utility will still apply.

Potential energy savings

If you can shift your electricity consumption patterns enough, you may be able to reduce your electricity bill compared to a normal fixed-rate plan.

These savings are possible if you move the majority of your energy usage to the free window. Here’s how you would go about doing that:

Keep all of the lights off all day, only turn them on during the free window
Run your laundry machines at night
Run the dishwasher at night
During the summer, “pre-cool” your home at night by blasting the AC, then turnoff your cooling system during the day
During the winter, “pre-heat” your home at night by blasting the heater, then turn off the furnace during the day

A good solution for homeowners with solar panels

If your home has solar panels and you can generate enough energy to power your home during the day without pulling from the Texas grid, then a free nights plan can be a great option.

Cons of free nights electricity plans

Increased daytime kWh rates

Unfortunately, free nights plans are often marketing ploys to encourage you sign up with one company over another. While the plan offers free or reduced energy rates at night, your energy charge during the day is elevated to overcompensate for your nighttime “savings.”

Most households end up paying more with a free nights plan than if they had signed up for a simple fixed-rate plan instead.

Here’s an example of an Electricity Facts Label from a real free nights plan. As you can see, the energy charge is incredibly expensive at 30.6 cents per kWh. That is over 3 times the cost of the energy charge on a simple-fixed rate plan.

Adjusting usage behavior and patterns is difficult

Whether you live in a large home or an apartment, alone or with a family, changing your electricity consumption to take advantage of a free nights plan is hard.

Texas is very hot for 8-9 months out of the year. Even if you pre-cool your home at night during the free hours, you may find indoor temperatures starting to rise around midday and through the evening. You may feel compelled to turn the AC back on. When this happens, you end up overpaying to run your air conditioner and jacking up your electricity bill.

To save big with one of these gimmicky plans, you have to shift a large percentage of your consumption to the night or the weekend, when most folks are sleeping or relaxing and enjoying themselves.

Solar panels are not always effective

Solar panels are a great way to generate power at home in Texas, but they do require sunlight to work. On days when the sun is not shining, you are stuck paying the overpriced Energy Charge during the non-free hours of a free nights plan.

What type of plan should you choose?

For the large majority of Texans, we recommend signing up for a simple fixed-rate plan instead.

Why? Because they lead to lower energy bills. If you’re skeptical, check out the charts below.

We compared one of our simple fixed-rate plans against a competitor’s free nights plan to see how the bills would turn out at different levels of energy usage.

Our simple fixed-rate plan leads to lower bills at 500, 1000, and 2000kWh.

If you’ve ever been enticed by an electricity plan offering free nights, you’re not alone.

It’s easy to find yourself wondering if the plan is too good to be true. These plans can be both intriguing and confusing, leaving potential customers like you scratching their heads as they try to determine whether free nights electricity plans can actually lead to savings on your monthly energy bills.

Free nights electricity plans are a form of marketing that is most often not beneficial to customers.
Careful evaluation of the plan’s terms and your personal energy consumption is required to determine if free nights plans offer potential savings, as they generally come with much higher rates during non-free hours.
Consider a simple fixed-rate plan as an alternative, or significantly adjusting your energy consumption habits, before enrolling in a free nights plan.
Always, always, always check the Electricity Facts Label before making a decision.

Learn more about other types of electricity plans

Written by Graham Lumley

Graham Lumley, Growth Product Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 10 years of marketing experience, he creates content to help consumers understand and save on their energy bills, bringing a fresh and dynamic approach to the industry.