Peak and Off-Peak Electricity Prices Explained

Peak and off-peak electricity tariffs can be a great way to save on electricity. So what are they, and are they right for you?

The next time you look at your power bill, you might notice there are two different types of costs for your power:

• Fixed charges – these are displayed as cents or dollars per day. You are charged this fixed rate each day, regardless of how much power you use
• Variable charges – the cost of the power you’ve used, based on consumption in kilowatts per hour (kWh)

While all power bills use this same structure, how your variable charge is calculated can differ between plans and providers. While some opt for a standard rate per kWh, others opt to mix it up, offering different prices for power used at different times.

This is known as a peak/off-peak tariff or ‘time of use’ pricing and, depending on how you use power, it’s a simple way to save on your electricity bill.

What is peak/off-peak power?

If your power plan uses time of use pricing, then you are charged a different rate of power depending on when that power is used. For example:

• Peak: 25c per kWh
• Off-peak 17c per kWh

This differs from a standard plan, which offers a single kWh price regardless of when you are using electricity.

What are peak and off-peak electricity times?

The exact times may differ between plans, and even location and/or network. But generally speaking, peak times are Monday to Friday, 7am-11am & 5pm-9pm.

How providers choose to offer their off-peak electricity differs. While some opt to provide cheaper rates at any time outside of peak hours, others opt for a day/night plan. On these plans, you only get off-peak electricity rates during the night (11pm-7am).

Off-peak and more off-peak

Some electricity providers offer three different rates of power, in the form of peak, off-peak and night rates (with nights being the cheapest). Other providers may refer to it as peak, off-peak shoulder, and off-peak. But the principle remains the same: you get cheaper rates during the day and weekends, and the cheapest rates overnight.

Why not just offer cheaper rates all the time?

There are a couple of reasons for offering cheaper rates for off-peak electricity:

Demand raises costs

For starters, wholesale electricity prices largely depend on demand. When demand is high, such as during peak times, your power company needs to pay more for the electricity it provides you. When demand is lower, such as during off-peak times, the wholesale price of electricity is cheaper.

So by incentivising users to use more power during off-peak times, power providers can ease peak demand and reduce overall costs. This means cheaper power for them and, if they’re nice, better rates and deals for their customers.

Sustainability

While most of New Zealand’s power generation is renewable, we do rely on dirty fossil fuel generation to help out during peak periods. By minimising the strain on our electricity grid during peak times, we can minimise how often we turn to fossil fuel generation.

Is a peak/off-peak power plan right for me?

This depends on a few factors:

• To make up for the cheaper off-peak rates, are you getting charged more for your peak power?
• How much electricity usage can you shift off-peak?

You may find that a power plan offers a great night rate but, to compensate, its standard rates are higher. This means to avoid overpaying, you need to direct as much of your power usage as possible to off-peak times.

It’s important to note that not all plans offering off-peak electricity charge more for peak rates. You may find a plan that has cheap rates all around! Even so, how much of a bargain it’s going to be will depend on how much usage you can shift off-peak.

Peak/off-peak tariffs may be best for:

• EV owners – who can use the cheap night rates to charge their EVs
• People who work odd hours – if you work nights and are home all day, for example, you can run all your appliances during cheaper daytime rates
• People who work from home – working from home can really add to your power bill. Cheaper power through the middle of the day can make a big difference
• Night owls and early birds – up extra late or extra early? Use that time for showers, laundry, and loads in the dishwasher
• Homebodies – typically all weekend is considered off-peak. So if you’re a homebody, this can not only save on your existing usage, but allows you to shift plenty of your chores to the weekend, too.

Do note that the above suggestions are under the assumption you are getting off-peak rates during the day. As mentioned above, some plans only offer discounted rates at night.

And aside from your rates, there are plenty of other factors to consider when choosing a power provider, which might determine whether a time of use plan is right for you

Does your provider offer:

• Signing on credit/deals
• Free power hours
• Excellent customer service
• Helpful online tools and/or a great phone app
• The ability to bundle other utilities such as broadband, gas, and/or phone plans for further savings
• Do you have to sign on for a long-term contract or can you leave whenever

Compare electricity providers for free with Canstar Blue!

Peak and off-peak power plans: what’s available?

Below is an overview of all the major electricity providers in New Zealand that offer one or more plans with peak and off-peak electricity rates. Do note the actual rates offered will be based on your personal information, so be sure to visit individual retailer websites for a quote.

Electric Kiwi

Electric Kiwi’s MoveMaster plan offers discounted rates during off-peak shoulder times and half-price rates during off-peak. Notably, its morning peak rates are just 7am-9am. Whereas many other providers charge peak rates until 11am. Throw in the fact that all Electric Kiwi plans come with an hour of free off-peak power, and there are plenty of savings to be made.

Peak times: 7am-9am, 5pm-9pm daily
Off-peak shoulder times: 9am-5pm, 9pm-11pm daily
Half price night times: 11pm-7am daily

Electric Kiwi is also the winner of Canstar Blue’s 2023 Most Satisfied Customers | Bundled Utilities Award, for its great electricity and broadband bundle deals. For more info, click here.

Flick

Flick’s Off Peak power plan lets you save between 21%-55% (based on meter configuration, network area and load group) of your peak power price.

Peak times: 7am-11am, 5pm-9pm
Off-peak times: 11am-5pm (excluding Christchurch), 9pm-7am & all day weekends

Flick is also the latest winner of Canstar Blue’s Most Satisfied Customers | Electricity Providers Award.

Octopus Energy

A new face in power in New Zealand, Octopus Energy offers some great rates. Notably, if you’re a low user, which most Kiwis are, you’ll pay no fixed daily rates. Its off-peak rates include half-price energy at night.

Peak times: 7am-11am, 5pm-9pm
Off-peak: 11am-5pm, 9pm-11pm & 7am-11pm on weekends
Night: 11pm-7am everyday

→Related article: Octopus Energy: A New Deal in NZ Electricity

Powershop

Powershop has Get Shifty rates, which offer discounted electricity rates during off-peak hours in some areas.

The times differ depending on your area and network, but in most areas peak rates fall within the standard times of: weekdays 7am-11am, 5pm-9pm.

For more info on Powershop’s Get Shifty rates and if they apply to you, click here.

Ecotricity

Ecotricity sets itself apart as New Zealand’s only provider of 100% renewable and carbonzero certified electricity.

It offers two plans that feature off-peak rates and savings of up to 40% on power:

• Low Eco Saver – for small 1- or 2-person households
• Eco Saver – ideal for EV owners

Peak times: 7am-11am, 5pm-9pm
Off-peak times: 9pm-7am, 11am-5pm & all day weekends

Contact

Contact Energy has two plans that offer cheaper overnight power:

• Good Nights: free power 9pm-midnight every night of the week
• Dream Charge: cheaper rates overnight, from 11pm-7am every night of the week

Nova

Nova has one open-term off-peak plan that breaks down its pricing into three bands: Off-peak, Shoulder and Peak.

The times of the three bands and the savings vary, depending on where you live around the country. And some areas just offer peak and off-peak rates. For more information on what’s on offer in your area, click here.

Night/off-peak EV power plans

While these providers don’t offer standard time-of-use rates, they do have plans with discounted night rates for EV owners. While these plans are primarily designed to save on EV charging costs, you can run other appliances during these hours to make the most of the discounted rates. Note that each of the following plans require evidence of EV ownership.

Meridian

Meridian’s EV Plans offers discounted electricity from 9pm to 7am every night.

Genesis

If you have an EV, Genesis will give you half-price power from 11pm-7am every night.

Mercury

Mercury’s EV Fuel Package applies a 20% discount to your existing Mercury plan between 9pm and 7am every night. Available on a two-year term.

 Compare electricity providers with Canstar Blue

Canstar Blue rates NZ power companies for customer satisfaction and value for money, see the table below for some of the results, or you can click on the button below for the full results of our survey.

Canstar Blue’s latest review of NZ power companies compares them on customer satisfaction. The table below is an abridged version of our full results, available here.

Compare electricity providers for free with Canstar Blue!

About the author of this page

This report was written by Canstar Content Producer, Andrew Broadley. Andrew is an experienced writer with a wide range of industry experience. Starting out, he cut his teeth working as a writer for print and online magazines, and he has worked in both journalism and editorial roles. His content has covered lifestyle and culture, marketing and, more recently, finance for Canstar.