R-TOU: Saving Money and Energy by Load Shifting, Part 1

Would you be willing to change your life just a little if you could save a bunch of money on your utility bills? That’s what we’re doing, by enrolling in a Time of Use program with our power company.

Last week, when I talked about what it was like to be a guy in the middle of the 31 Days of Living Well and Spending Zero Challenge, I mentioned that we were enrolling the our power company’s Time of Use program. At the time, i referred to it as R-ToD, but it’s actually the Residential Time of Use program, or R-TOU (My bad. I’ve corrected it on the original article). So I thought I’d talk about what it’s like to shift your energy usage to lower demand times.  What do you have to do? How do you prepare?

And how do you shift your usage around to reduce your power costs and leave a smaller carbon footprint?

R-TOU Program Basics

We are still preparing for our Residential Time of Use meter installation from our power company. Once the new meter is installed, we will be charged different rates for power consumption at different times of the day, based on the level of expected energy demands:

  • On Peak: This is when expected demand is the highest. Under R-TOU, we’ll actually have to pay 21/24 cents per kilowatt hour for electricity, so we’ll need to minimize energy usage.
  • Shoulder Peak: This is when expected demand for electricity is still considerable. We’ll have to pay 11/12 cents per kilowatt hour for electricity, so we’ll need to watch energy usage.
  • Off Peak: This is when expected demand for electricity is least. We’ll pay 7 cents per kilowatt hour for electricity, so this is the best time to do energy-intensive activities.

These higher prices for on-Peak and shoulder rates come into play from June-September, when air conditioning is pulling higher demand loads than heating systems do the rest of the year.

The designation of on-peak and shoulder peak varies, though weekends and holidays are always considered off peak. On-peak and shoulder rates depend on season:

  • From April through September, on peak is 1-6 pm and shoulder peak is 11am- 1pm and 6-8 pm.
  • From October through March, on peak is 6-9 am and shoulder peak is 9am-12pm and 5-8 pm.

As long as we shift our energy-intensive activities to off-peak times, we should save money over the 10-11 cents per kilowatt hour we are currently paying.

So things like heating and cooling the house, heating water, doing laundry, washing dishes and using the oven will all need to move to off-peak time. Right now that includes evenings, afternoons, weekends and holidays.

The objective is to shift power usage to off peak times and to minimize on-peak usage. Using off-peak power is less expensive for the power company, who might have to engage more expensive, less ecologically-friendly power-generating systems when demand is high.

Let’s Start with Our Hot Water Heater

An easy way to shift usage is to only heat water when off peak rates are applied. Hot water heaters are high electricity users, accounting for approximately 17 percent of your total energy bill, according to the US Department of Energy. It’s a good target for saving energy, because most people leave it on all of the time but don’t really need to in order to get all of the hot water they need.

To do this, we’ve added a timer to the hot water heater. Cost: around $40-$55, not including installation (which I did myself, but I’m comfortable with wiring projects). Over the course of the year, this should translate to a significant savings.

Another good addition is a water heater insulation cover. Since you will have time periods during the day when the water heater is off, you don’t want the water in the tank to lose heat, and a cover helps prevent that.Insulation covers vary in price, ranging from around $20-40.

We have also insulated the copper water pipes close to the water heater with foam pipe insulation. (this runs around $2 for a roll of insulation.) We still need to install flow restrictors on the faucets around the house (around $4 each for 4 faucets) and a low flow shower head in the bathroom (starting around $8).

Doing laundry can easily move to weekends and evenings, as can running the dishwasher.  Otherwise, our daughter takes her bath right before bed and we get our showers early in the morning, neither of which will need to change.

So, a timer, an insulation cover, hot water pipe insulation, flow restrictors and a new shower head. Total Cost to prepare the hot water for R-TOU:  approximately $95 and a few minor adjustments to when we do laundry and wash dishes.

R-TOU Project Continues

We are taking R-TOU one step at a time. The next step will be a trip to the local Home Depot (only 2 miles away!) to purchase those faucet flow restrictors and a low flow shower head. We will try out one of the medium flow shower heads first. We can always move up to the ultra-low flow shower heads if we decide to be really cheap.

I’ll go more into the costs for cooling and heating the house, which is by far the most energy intensive use of home power, in the next installment. But with just a few minor adjustments and a little bit of money invested, we should be able to drop our power costs and live greener. If we can save 20% of our annual energy expenditure, we’ve saved $400, and I think that’s a conservative savings estimate.  I expect that the program will pay for our set-up costs over the first 6 months.

Maybe it’s not easy being green, but it doesn’t have to be difficult either.

What changes have you made to save on your electrical usage and electrical bills? Do you have experience with a time of use program you can share?

*Part of Financially Savvy Saturdays on brokeGIRLrich, A Disease Called Debt and One More Broke Twenty-Something*

4 Responses to “R-TOU: Saving Money and Energy by Load Shifting, Part 1”
  1. RAnn 11/09/2015
    • Emily Jividen 11/09/2015
  2. Mel @ brokeGIRLrich 11/09/2015

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