3 minute read • Graham Lumley • Last update September 2024
Peak hours occur during the time of day when demand for electricity is the highest. Off-peak hours describe the rest of the time when businesses and residential customers use less electricity.
During peak hours, increased demand for energy drives the price of wholesale electricity higher. The opposite plays out during off-peak hours, meaning wholesale electricity prices fall along with decreasing demand.
According to the Energy Information Administration, peak hours, when electricity demand is highest, vary based on the time of day, day of the week, and the season.
In the summer, peak hours occur between 3:00PM-7:00PM. These are the hottest hours of the day when air conditioners work overtime to keep businesses and homes cool. Demand is exacerbated when people return home from work in the evening.
In the spring and fall, when weather is milder, peak hours there is a smaller peak in the morning between 6:00AM-9:00AM and a larger afternoon peak between 4:00PM-8:00PM. The morning peak occurs when everyone is waking to get ready for work or school. The afternoon peak occurs when folks return home form work, but is usually less intense than peak hours during the summer.
In the winter, peak hours are no longer tied to the use of air conditioning, but the use of heating. There can be two peaks during the winter. Between 6:00AM-9:00AM when people wake up and turn the heat on because winter mornings are colder. Then, again in the evening from 5:00PM-9:00PM when people return from work. Winter evenings are dark and cold, so more people are turning up the heat and turning on more lights.
During the week, peak hours are often more pronounced because society follows a routine of waking up, going to work or school, and returning home in the afternoon or early evening. Over the weekend, usage may be lower or more spread out.
Peak hours can significantly impact your electricity bill, depending on the type of plan you’ve selected. Time-of-use and variable plans are subject to the most impact from peak hours, while fixed-rate plans feel the least influence.
Time-of-use plans offer different electricity rates throughout the day, typically with higher prices per kWh during peak hours and vice versa. That means, the more electricity you use during peak hours, the higher your bill will be.
On a variable pricing plan, your electricity rate can change month-to-month. During the summer, when peaks are the highest, variable rates can become rather unaffordable.
On a fixed-rate plan, you are locked into the same rate for the duration of your contract, meaning your price per kWh does not change during peak hours. However, it’s still important to be wary of your electricity consumption, especially during peak hours in the summer. If you set your thermostat to a low temperature, then you can expect higher bills.
If you’re interested in an electricity plan that skirts increased prices for energy, look no further than BKV Energy. Our Bluebonnet plan offers an affordable fixed rate at all times of the day, every day, for the duration of your contract. Additionally, this plan has no base charges, no usage fees, and comes with a 30-day risk-free trial. Finally, enjoy our robust loyalty and rewards program, just for signing up. Enter your zip code to explore rates in your area.
