Time-of-Use Electricity Tariffs: Are They Right for You in 2025?

Time-of-use (TOU) electricity tariffs charge different rates depending on when you use power. In 2025, with smart meters now widespread, more Australians are considering whether TOU pricing could save them money—or cost them more. Here’s what you need to know.

How Time-of-Use Tariffs Work

Unlike flat-rate plans (where you pay the same rate 24/7), TOU tariffs divide the day into pricing periods:

Peak: The most expensive period, typically late afternoon and early evening (e.g., 3pm–9pm on weekdays) when demand is highest.
Off-peak: The cheapest period, usually overnight (e.g., 10pm–7am) and sometimes weekends.
Shoulder: Mid-priced periods between peak and off-peak (e.g., 7am–3pm and 9pm–10pm on weekdays).

Example rates (2025):

Peak: 45–55c/kWh
Shoulder: 25–35c/kWh
Off-peak: 15–20c/kWh

By shifting your electricity usage to off-peak and shoulder periods, you can significantly reduce your bill.

Who Benefits from Time-of-Use?

TOU tariffs work best if you can shift your energy use away from peak times:

Good candidates:

Households with flexible schedules (retirees, work-from-home)
Homes with programmable appliances (timers on dishwashers, washing machines, pool pumps)
EV owners who can charge overnight
Solar households with batteries (use stored solar during peak instead of buying from the grid)

Not ideal for:

Families who are home in the afternoon and evening with high peak usage
Households that can’t easily shift usage patterns
Homes without smart meters or programmable appliances

How to Make TOU Work for You

If you’re on or considering a TOU tariff, here are strategies to save:

1. Shift Appliance Use

Run dishwashers, washing machines, and dryers during off-peak or shoulder periods. Many appliances have delay-start timers.

2. Heat and Cool Strategically

Pre-cool your home in the afternoon before peak starts, or use reverse-cycle heating overnight. Avoid running air conditioning during peak.

3. Charge EVs Overnight

If you have an electric vehicle, charge it during off-peak hours (typically after 10pm).

4. Use Battery Storage

If you have a home battery, charge it with solar during the day and use stored power during peak hours instead of buying expensive grid electricity.

5. Monitor Your Usage

Smart meters and energy monitoring apps let you track when you’re using power. Use this data to identify opportunities to shift usage.

TOU vs Flat-Rate: Which Is Cheaper?

The answer depends on your usage patterns:

Scenario A: Family with high peak usage A family that’s home in the afternoon and evening, running air conditioning, cooking, and using appliances during peak hours, may pay more on TOU than a flat rate.

Scenario B: Retiree with flexible schedule A retiree who can run appliances during the day (shoulder) or overnight (off-peak) and minimise evening usage may save significantly on TOU.

Scenario C: Solar household with battery A household with solar panels and a battery can export during peak, use stored solar overnight, and pay almost nothing for grid electricity.

Use comparison tools like Energy Made Easy to estimate your annual cost under both TOU and flat-rate options.

2025 Market Trends

TOU tariffs are becoming more sophisticated:

Demand tariffs: Some plans now charge based on your peak demand (the highest rate of electricity use at any moment), not just total usage. This can hit households with high instantaneous demand (e.g., multiple appliances running simultaneously).
Critical peak pricing: Some retailers offer plans with very high rates during a few critical peak events per year (e.g., extreme heat days), offset by lower rates the rest of the time.
Dynamic pricing: Emerging plans adjust rates in real-time based on wholesale prices. Savvy consumers can save by monitoring prices and shifting usage accordingly.
Solar sponge tariffs: Some plans offer very cheap off-peak rates during the middle of the day to absorb excess solar from the grid—great for EV charging or running pool pumps.

Real-World Example

The Andersons in suburban Adelaide switched to a TOU tariff in 2025. By running their dishwasher and washing machine overnight, pre-cooling their home in the afternoon, and charging their EV after 10pm, they reduced their annual electricity bill from $2,000 to $1,500—a saving of $500 per year.

The Bottom Line

Time-of-use tariffs can save you money—but only if you can shift your electricity usage away from peak periods. Before switching, analyse your usage patterns, compare estimated costs, and consider whether TOU aligns with your lifestyle. In 2025, smart meters and energy apps make it easier than ever to take control of when you use power.