What is the benefit of having Time-of-Use (TOU) pricing?
Currently, consumers have little financial incentive to manage their use of electricity over the day. Smart meter pricing sets a higher price at peak periods when prices are highest in the wholesale market. This gives consumers an incentive to reduce or shift their use to periods of lower demand (e.g. weekends or later in the evening) and away from times when electricity is most expensive. Consumers will not be able to shift all of their electricity use away from peak demand periods, but the more they are able to do so, the more they can manage their costs and contribute to lower overall peak electricity prices for everyone.
