[UC49] Time Of Use Rate Analysis

Consumer Rates and Programs

The ability to analyze the impact of Time-of-Use (ToU) rates on consumption patterns, consumption peaks and utilities' income.

The Utility Problem

Traditionally, electricity consumers paid a flat rate per kWh – consumed energy. With the advancements in household electrification and with changes in society’s behaviour, a clear usage pattern is emerging where electricity demand increases during the morning and afternoon hours (often referred to as peak hours) and decreases significantly during mid-day and at night (off-peak hours).

Managing the grid’s demand is a complex task with which utilities need to deal on a daily basis. For example, when utilities need to respond to the maximum electricity demand, they have to increase their capacity even though most of this capacity is not required during off-peak hours. Local energy load peaks also contribute to lower power quality which is not optimal for electricity users. The presence of grid peaks will continue to be more prominent with the transition to EVs, electric stoves and electric heating since more tools, equipment and things start to use electricity as a source of energy.

To reduce the need for more capacity, utilities have been introducing different rate plans that aim to shift some of the electricity usage from peak hours to off-peak hours – these plans are called Time-of-Use (ToU) rates. Such rate plans are introduced by more utilities across the globe.

For utilities, to be sure that the ToU rates are impactful, it is important to be able to analyze them in order to predict their impact on the temporal shape of consumption load (peaks and valleys) and on utilities’ income. Thus, it is important to have a data platform which allows for such type of analysis.

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