No shameless self-promotion involved in this posting, but in otherwise related electric rate news the Boston Globe reports that Massachusetts Governor Mitt Romney is favoring a proposal to implement time-of-use rates for residential customers in the state. According to the article, the plan would have a higher afternoon rate between 2 PM and 5 PM.
Particularly during the summer, demand for electricity normally peaks during those hours. Because of the wholesale electric market’s unusual economics, prices can soar to 15 times normal levels during those hours. But except for some large business and industrial customers, utility rates remain constant every hour, so few customers have an economic incentive to conserve during the hours it would help most.
My initial sense was that afternoon peaks were often as late as 6 to 7 PM, but a brief examination of Massachusetts load data (available from the ISO New England here) confirms that summer peaks tend to occur from about 3 PM to 5 PM. Winter peaks come later in the day in Massachusetts, but summer peak demands are higher than winter peaks, even in New England.