Hawaii’s New Time-Of-Use Utility Pricing
The Hawaiian Electric Company is rolling out their statewide Time of Use (TOU) billing system, taking effect in Hawaii in late 2024 (or early 2025). This is an important change for the island’’s residents and businesses. TOU pricing means that customers are charged different rates depending on when they use electricity during the day. These changes will impact the benefits of switching to solar power.
Let’s take a look at how this will affect businesses, households, and renters in Honolulu and other areas of the island chain.
Why is HECO switching to Time-Of-Use?
Utilizing a time-of-use rate plan allows the electric company to provide discounted energy to users who operate their devices in off-peak hours when the grid is under less stress. This not only incentivizes responsible energy use within low-demand hours, it allows users the opportunity to reduce their electric bill if they can keep their own use down during peak hours.
Hawaii Leads the Nation in Energy Policy
Hawaii is the first state to implement TOU pricing, which shifts the cost of electricity based on when it’s used. Under HECO’s TOU pricing, you pay more for electricity during peak hours and less at off-peak times. The aim is to encourage people to shift their energy consumption away from peak periods like weekday afternoons and into off-peak times like evenings and weekends.
Hawaii has been rolling out this new plan over several years as part of an effort to reduce its dependence on fossil fuels for power generation by 2040. In 2020, Hawaiian utility providers had published plans to implement some form of TOU pricing plan.
Adding solar batteries to your system can maximize your savings
If you’re looking to save money on your utility bill, adding solar panels and batteries can help. However most users use less power during the daytime, which can be an issue with the upcoming Time-of-Use pricing policy that gives better rates to midday users. But the solar you produce during the day doesn’t need to go to waste.
Batteries store excess solar energy during low-usage periods so that it can be used later when demand is high and prices are high. Together these systems help ensure that you pay less for electricity in the evenings when rates are highest–and still avoid paying any more than necessary during peak hours!
TOU utility pricing means you pay less for electricity during off-peak hours.
Off-peak hours are typically in the middle of the day, when demand is low. This reduces the amount of generation needed to meet community needs, which makes it cheaper for utilities to produce power during those times.
The good news: if your home has solar panels, they’ll be producing electricity during off-peak hours!
TOU utility pricing is based on how much electricity you use and when you use it.
TOU pricing is based on how much electricity you use, and when you use it.
The price of electricity varies throughout the day. If a utility company charges different rates for peak and off-peak hours, your bill will be higher or lower depending on when you’re using power.
The exact rate depends on which time period you’re in:
- Peak – Monday through Friday from 7 am until 11 pm; Saturday from 6 am until 10 pm; Sunday all day
- Off-peak – Monday through Friday between midnight and 6 am; Saturday between 1 am and 6 am; Sunday all day
Understanding HECO’s new TOU rates can help you save money on your electricity bill
If you’re a heavy user of electricity, the new Hawaiian electric rates may not be for you. Heavy users are people who use more than 30% of their total energy on weekdays during peak hours (7:00AM-10:00AM and 5:00PM-7:00PM). If this sounds like your family, then it’s probably not worthwhile to learn more about TOU pricing because it won’t save money for your household.
Hawaii’s new Time Of Use utility pricing is a great step towards smarter energy use, but it won’t be enough to solve all of our problems. Adding batteries and solar panels to your home is an additional step to save even more money on your utility bills.
If you’re looking to go solar, let our solar experts help you with a free quote.
Our team can design the perfect system to match your energy use, saving you money in the long run against ever growing energy costs.