How will Time of Use tariffs help electricity customers?
SP AusNet’s Time of Use tariff increases prices in peak periods, roughly 15% of the year, compared to the flat rate, and reduces them to a third of the flat rate for 85% of the year. This will only affect a small number of customers at first, in line with the smart meter roll-out. The impact on individual customers will depend on when they use energy and whether the retailer reflects the full price signal in their customer’s bills. In particular, those customers who have a higher proportion of their usage in ‘off peak’ periods than an ‘average’ customer will see reductions in their bill, relative to a flat rate tariff structure, whilst conversely, those customers that use a higher proportion of their energy in peak periods than an average customer may experience higher bills. A Time of Use tariff structure presents a powerful incentive for people to use energy as efficiently as possible, particularly during peak periods – even those consumers who may experience a lower bill as a result
