Not all electricity is priced the same. Whether you pay more or less per unit depends heavily on when you use it — if your business is on a Time-of-Use tariff.
Time-of-Use (TOU) tariffs are one of the three main electricity tariff structures available to South African businesses. They're increasingly common as municipalities and Eskom push larger commercial and industrial users onto dynamic pricing. Yet many business owners on TOU tariffs have no idea how they actually work — and are paying peak rates for consumption they could easily shift.
How Time-of-Use Tariffs Work
A TOU tariff divides the day into three pricing periods:
Peak Period
The highest-rate window. Typically applies during morning and evening hours on weekdays when electricity demand across the national grid is at its highest. During peak periods, each unit of electricity you consume is charged at the maximum rate. On Eskom's high-season schedule (June to August), peak rates are significantly higher than the rest of the year.
Standard Period
A mid-range rate applied during moderate-demand windows — typically shoulder hours surrounding the peak periods. Standard rates apply on weekdays during the day and may extend into Saturdays depending on the specific tariff.
Off-Peak Period
The lowest rate, applied late at night and on Sundays. If your business can shift energy-intensive processes to these windows — whether that's running industrial equipment, HVAC pre-cooling, charging systems, or manufacturing cycles — the cost difference per kWh can be substantial.
The exact timing of these windows varies by tariff and season. High season (June–August) generally has longer peak periods and higher peak rates than low season. Annual tariff revisions on 1 July adjust all three rate levels.
When TOU Works in Your Favour
A TOU tariff can save a business significant money when:
- A meaningful proportion of energy-intensive operations can be scheduled outside peak hours
- The business has on-site storage, process flexibility, or load-shifting capability
- Operations already run overnight or during weekends
- The business has invested in solar or battery systems that can be optimised around TOU windows
In these cases, the lower off-peak rates can more than compensate for the higher peak rates, resulting in a lower average cost per kWh than a standard tariff would provide.
When TOU Works Against You
A TOU tariff can cost more than a standard tariff when:
- The business has rigid operating hours that fall predominantly during peak and standard windows
- There is no flexibility to shift load — for example, a retail operation that must be fully operational during business hours
- Consumption is relatively flat across all time windows, meaning the higher peak rate outweighs the discount on off-peak
This is a real problem. Businesses can end up on TOU tariffs that were never appropriate for their usage profile — sometimes because the tariff was assigned by default at account setup, sometimes because operations changed since the tariff was selected, and sometimes because the tariff category was applied in error.
The Tariff Verification Problem
Determining whether your business is on the correct tariff requires more than glancing at your invoice. It requires:
- Analysing your actual consumption profile across peak, standard, and off-peak windows
- Understanding the specific rate structure applied by your distributor
- Comparing what you currently pay against what you would pay under alternative tariff structures
- Checking that the tariff category on your account matches your connection type and consumption volume
Most businesses have never done this analysis. Many don't know which tariff structure they're on. And because the invoices don't show a clear breakdown of peak vs off-peak consumption — just a total kWh figure and a total charge — there's no obvious signal that something is wrong.
What Correct Tariff Classification Is Worth
A manufacturing business consuming 150,000 kWh per month that shifts 40% of its load to off-peak windows on a TOU tariff can reduce its average energy rate by 15–25%. At current tariff levels, that translates to R30,000 to R50,000 per month in recoverable cost — simply by running energy-intensive processes at the right time.
That opportunity is only visible if someone has actually mapped the business's consumption profile against its tariff structure. Most haven't.
Find Out What Tariff Your Business Should Be On
OptiRate's Rate Calculator benchmarks your electricity costs against verified tariff data. In under two minutes, you'll see how your current rates compare — and whether a tariff review is warranted.