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Time-Variant Pricing and Its Effect on Your Home Comfort


Your utility may have adopted a practice called time-variant pricing, which adjusts the cost of electricity as it is consumed throughout the day according to how much demand there is. Although this practice may at first seem somewhat worrisome, it can actually work for you as you strive to maintain a more efficient household.

You can tell if your utility is practicing time-variant pricing by looking at your electrical bill or on the utility's website.

Peak Demand

Most demand will occur in the heat of the afternoon, as people are returning home from work or school and set the thermostats down. That's likely when your utility is charging most for electricity.

Why does the utility charge more? To meet the demand on the grid, power companies have to rely on energy produced from less efficient and more expensive power plants -- plants that are seldom used throughout the year. These plants not only cost more to run, but they also rely on fuels that throw more carbon emissions into the environment. So not only does diverting many of your electricity-consuming tasks until times of less demand lower your utility bill, it will also help reduce carbon emissions.

Reducing Electricity Use During Peak Demand

To save money with time-variant pricing, wait until the cost of electricity goes down in the evening to run the dishwasher or clothes washer or dryer. You can also try setting the thermostat back a couple of degrees during the times when electricity costs most.

Augment your savings and reduce carbon emissions by doing the following:

  • When having a new HVAC system installed, make sure it's the right size for your house so it runs efficiently. Too large and it will short cycle; too small and it will run all the time.
  • Choose Energy Star-rated appliances. They are certified efficient by the U.S. government.
  • Install efficient lighting.
  • Fix air leaks in your home's exterior walls and in ductwork.
  • Add insulation above the ceiling.

Visit Valley Heating, Cooling and Solar for in-depth information on most HVAC topics or to learn more about time-variant pricing. Or, just give us a call at (408) 868-5500.

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