What is a Time-of-Day (TOD) Tariff?
What is a Time-of-Day (TOD) Tariff? Have you ever wondered why your electricity bill sometimes feels higher, even when your usage seems consistent? One reason could be the Time-of-Day or TOD tariff – a smarter way to price electricity that reflects when you use it, not just how much you use. So, what exactly is a Time-of-Day tariff? A TOD tariff is an electricity pricing system where the rate you pay varies based on the time of day. The day is divided into peak hours, off-peak hours, and normal hours – each with different pricing. Let’s break it down: Peak Hours are when electricity demand is at its highest – usually in the mornings and evenings when people are getting ready for work or returning home. During this time, electricity is more expensive. Off-Peak Hours are the opposite – when demand is lower, such as late at night, early morning, or weekends. Electricity is cheaper during these hours. Normal Hours are neither peak nor off-peak and are charged at a standard rate. Now, how d...