Time-of-Use
Time-of-Use (TOU) rates give customers the opportunity to reduce their electric bills by shifting the time of day when they use electricity. It is more expensive to serve customers on-peak – when demand for electricity is high. Through our TOU rate, customers who shift the majority of their usage during low electric demand – known as off-peak times – are able to save on their electric bills.
TOU periods
With TOU, electric energy charges are lower than standard electric service rates during off-peak hours. TOU rates are broken into four periods as outlined:
Weekends as well as New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day are always off-peak.
Pricing varies with time of day
- All electric consumption is charged a lower base energy, all kilowatt-hour (kWh) charge. (During off-peak times, it is the only energy charge.)
- During off-peak hours, electric energy charges are lower than standard electric service rates.
- During on-peak hours, electric consumption is charged the base energy, all kWh charge plus a peak charge that reflects the extra cost to generate electricity for the highest summer energy demand period.
Pricing varies with the season
- On-peak period charges are higher during the summer months (June 1 through September 30).
- On-peak Period 2 (weekdays from 1 p.m. to 6 p.m.) increase more than on-peak Periods 1 and 3 during the summer months.
- The base energy, all kWh charge, stays the same throughout the year.
Program details
- A customer choosing to enroll must stay on TOU rates for at least one year. After one year, customers may shift back to the standard rate.
- Customers opting into TOU will have a special meter installed at no extra charge.
- MGE business customers with a demand greater than 20 kW must be served on TOU rates. TOU rates are optional for all other customers.
How can residential customers benefit?
Residential customers who shift significant electricity use from times of high electric demand to when demand is low, could save money with this rate option. Typically those who are saving on this rate:
- Are away from home during the day Monday through Friday.
- Have homes with large electric users:
- Water heater
- Dehumidifier
- Electric clothes dryer
- Central air conditioner
- Plug-in electric vehicle
How can business customers benefit?
Business customers will see the greatest benefit when they shift as much of their electricity use to the "off-peak" times as they can. Typically, business customers who can use at least 60% of their use "off-peak" will save on their energy bills.
Business who reduce overall energy use with conservation measures and/or improve the energy efficiency of their equipment and buildings will see the greatest savings.
Note: Business customers with a demand greater than 20 kW must be served by TOU rates.
To sign up
- Residential customers: please contact the Home Energy Line at 608-252-7117 or email AskExperts@mge.com.
- Business customers: please contact your MGE account representative at 608-252-7007 or email Business@mge.com.
Frequently Asked Questions
TOU rates offer customers more control over their electricity costs. The rates encourage customers to use more of their electricity during lower cost times, thus helping to balance the electric load on our system. TOU customers pay more when it is more expensive for MGE to buy or generate power to meet the needs of all customers.
Lower off-peak rates are in effect about 68% of the time during the following time periods:
- 9 p.m. to 10 a.m. Monday through Friday
- Weekends
- Major holidays: New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Day
Electric demand is the rate at which a building uses electricity, measured in 1,000-watt increments, or kilowatts (kW). Demand typically varies throughout the day, depending on how much equipment is drawing power at the same time.
The monthly on-peak demand charge covers the cost of providing adequate generation and transmission service during peak times. It is based on the greatest rate at which your building has used electrical energy during any 15 consecutive minutes during on-peak hours in a specific billing period.
The customer maximum demand charge covers the cost to support, operate and maintain the local delivery system of wires and equipment necessary to move electricity from the transmission system to your business. It is based on the greatest rate at which you have used electrical energy during any 15 consecutive minutes in the current or preceding 11 billing periods.
