How time-of-use energy tariffs help you take control of your energy spend
Key takeaways
- TOU tariffs, as opposed to flat rates, are calculated based on the time you use electricity.
- Under the TOU tariff, going solar and adding battery storage lower your energy spend by allowingyou to charge your solar batteries from the grid when energy is cheaper or solar power is unavailable.
- Smart meters are essential for TOU tariffs, as they track your electricity usage in real time so that you cancalculate your electricity cost.
- The Hoymiles MS-A2 is the perfect way to take advantage of TOU tariffs. Its TOU mode allows you to automatically switch between grid power, solar power, and battery power depending on the cost of energy.
- The Hoymiles MS-A2 can also integrate with the Shelly Pro 3EM smart meter and the Shelly Plug S for extra control.
- Taking advantage of dynamic pricing with the Hoymiles MS-A2 could save you between €71 and €165*.
*The figures are for reference only. The actual cost depends on your location and your energy usage.
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Nowadays, the rising cost of energy is on everyone’s mind.
But what if there was a way to save money even if you use the same amount of energy?
That’s where time-of-use (TOU) pricing comes in.
Time-of-use rates are a kind of dynamic pricing that makes it much easier to control your spend, particularly when used together with a solar power system.
They’re an excellent way to use your energy budget more effectively – and make sure that you’re never paying more than you need to for the energy you use.
It’s no wonder that they’re becoming increasingly common – and popular – around the world.
Let’s explore TOU tariffs in more detail.
What is a time-of-use (TOU) electricity price and what are the benefits?
Usually, your electricity bill is based on a flat rate: Your provider determines how much an hour of electricity costs, calculates how many hours you used over the month, and then charges you accordingly. Every hour of electricity costs exactly the same amount.
But electricity doesn’t always have the same value. In theory, when electricity is in high demand – at around 7pm, for example, when homeowners begin to arrive home from work and start cooking or watching TV – it would cost more.
However, there are also times when electricity is in low demand – say, in the middle of the night when most people are asleep. If you’re using energy at those hours, it should cost less.
Time-of-use tariffs are designed to reflect that the “value” of energy rises during peak hours and falls during off-peak hours.
Instead of just charging you one flat rate, your electricity provider calculates how much electricity was worth when you were using it. Then they add it all up together to calculate your electricity bill.
How can you benefit from a TOU tariff?
If you know how to use your energy efficiently, a TOU tariff can be an excellent way to save money on your bills.
If you want to maximize your savings, you’ll need to consider two things:
Using smart metering
A traditional electricity meter keeps a record of how much energy you’ve used in a day, then sends that data directly to your supplier. It doesn’t have any idea when you used that electricity – only how much you’ve used.
This is where smart meters can be very useful. Smart meters keep a record of when you use electricity and the price of electricity at the time you use it. They’re usually updated with this information every half an hour.
Smart meters are becoming increasingly popular across both the U.S. and Europe.
As part of its sustainability efforts, the German government will make smart meters mandatory for electricity suppliers from 2025 onwards, expecting them to be rolled out across the country by 2032 at the latest.
While the U.S. doesn’t currently have any legislation requiring electricity providers to offer dynamic electricity pricing, smart meters are still becoming increasingly popular: In 2022, the U.S. Energy Information Administration (EIA) estimated that smart meters made up about 72% of total electric meter installations.
If you want to switch to a TOU tariff, your energy provider will need to install a smart meter in your home.
Solar and energy storage
Installing a solar battery storage system means that, when the sun is shining but you’re not using much energy, you can store that solar power for when you need it later.
If you add bidirectional converter technology to this storage system, you can go one step further: You can charge your battery using energy from your solar panels or charge it with energy from the grid.
This means that, if your solar panels aren’t generating enough energy to power your home, you can charge your batteries from the grid whenever energy prices are lowest.
In the evening, instead of switching to “peak price” grid power, you can use the energy you stored earlier in the day to power your home.
It’s a great way to maximize your savings on solar power and grid power at the same time.
Introducing the Hoymiles MS-A2 micro storage solution
We’re passionate about helping our customers reduce their carbon footprints and their energy bills. So we created a solar storage solution that’s perfect for use alongside a TOU tariff.
How does the Hoymiles MS-A2 TOU mode work?
Our micro storage solution comes with a “TOU mode” that’s specially designed for dynamic tariffs.
During off-peak hours, you can charge the Hoymiles MS-A2 using grid power. Then, during peak electricity hours when energy is the most expensive, the battery will discharge its power – automatically saving you money.
To enable this function, all you need to do is:
- Turn on “TOU mode”
- Turn on the default schedule, or set your own time-of-use schedule to tell the battery when it should charge and discharge. If your tariff also has varying rates for weekdays vs. weekends, you can set this too.
Compact battery storage systems like the Hoymiles MS-A2 can be used in a wide variety of installations, but they’re perfect for small spaces – particularly balcony solar systems, which are becoming increasingly popular in apartments across the U.S. and Europe.
How much can you save with the Hoymiles MS-A2?
Everyday savings can add up and have a huge impact on your bank account.
Let’s look at an example of an average household in Germany.
When we made these calculations in mid-2024, prices were as follows:
Average electricity price | Minimum electricity price (14:00 to 15:00) | Maximum electricity price (20:00 to 21:00) |
24 cents/kWh | 15.28 cents/kWh | 35.21 cents/kWh |
*The figures are for reference only. The actual cost depends on your location and your energy usage.
If a household fully charges the Hoymiles MS-A2 (using 2.24 kWh of electricity) during off-peak hours and uses that energy every day during peak times, they would be able to save between €71 and €165 annually.
That’s a significant dent in your electricity bill.
How does the Hoymiles MS-A2 integrate with the Shelly smart meter and plug?
In our latest model of the Hoymiles MS storage system, we’ve added a new functionality: integration with two next-generation Shelly products:
Shelly Pro 3EM smart meter
Combining the smart meter with the Hoymiles MS-A2 makes it easier to both control your grid energy consumption and export any extra solar power you generate back to the grid.
Shelly Plus Plug S smart plug
This smart plug allows you to remotely control your heating, lighting, or any other connected appliance – and, crucially, can work alongside the Hoymiles MS-A2 to help you understand how much energy your appliances are using.
Simple steps to add Shelly devices to your micro storage system
- Click “Link Shelly”in the system you created in the Hoymiles Home app
- On the homepage, data fromthe Shelly smart meter are shown as the grid data and consumption data measured by smart plugs are shown as “smart plug data”.
- Shelly devicesto be added to the MS-A2 system must be configured to the same Wi-Fi router as MS-A2.
- You can add up to 5 Shelly plugs and onlyone smart meter in an MS system.
Allocate your power usage flexibly and wisely
You can allocate power usage more wisely based on the data measured by the smart plugs. Users can also customize the temporary load for a certain period to meet short-term household needs. The temporary setting will be automatically disabled when the time is up.
Time to take control of your energy bills?
Between smart meters, TOU tariffs, and the latest solar and battery technology, it’s easier than ever to use your energy budget wisely.
With both governments and consumers standing behind it, this kind of energy setup is going to become more and more popular over the next few years.
So, if you’re looking for ways to reduce your emissions, understand your energy use, and cut your electricity bills, the time is now.
