Electricity prices in Arizona can vary depending on the time of day, with rates increasing during peak hours when demand is at its highest. If you’re looking to save money on your monthly energy bills, knowing when electricity is cheapest can make a big difference. On top of that, you can even take advantage of these fluctuating electricity prices by designing solar and battery systems to maximize return based on the most ideal rate plan for your home and lifestyle. In other words, getting maximum return is about matching the right rate plan for YOU, to the right combination of panels and battery to facilitate the quickest payback. Here’s a hint, it might not mean going for100% offset. Often the quickest payback happens at 70%-80% offset.
In this article, we’ll break down how time-of-use rates work in Arizona, including the cheapest and most expensive times to use electricity depending on major utilities. We’ll also show you how to use battery storage to save on your electricity bill by storing cheaper off-peak energy and using it during the most expensive daytime hours.
If you want to save money on electricity, the first step is to understand time-of-use (TOU) rate plans. While standard electricity plans charge the same rate for electricity all day, a time-of-use plan adjusts rates based on when power demand is highest in any given territory.
Essentially, you’ll be paying less if you use electricity during off-peak hours, when demand is low. But if you use electricity during peak hours, when the grid is under the most strain, you’ll be paying higher rates.
TOU rates help utility companies manage electricity production and grid stability. Energy use tends to spike during particular times of day, especially late afternoon and early evening when homes and businesses turn on air conditioning, appliances, and lighting all at once. To meet this peak energy demand, utilities must either ramp up power generation or buy electricity from other sources, both of which can be expensive.
With TOU pricing plans, utilities encourage customers to shift their energy use to lower-demand hours – when electricity is more affordable and readily available – helping reduce strain on the grid. This means you can reduce your electricity bills by simply running appliances, charging devices, and using your air conditioning at specific times of day.
All the major utility companies in Arizona offer TOU plans, however each has different rate structures. TOU plans are available from:
TOU plans divide the day into different pricing periods:
If you want to manage your electricity costs, you’ll need to know when off-peak and on-peak hours are for your specific utility. We’ll cover on-peak and off-peak hours for different utilities in the next section.
On-peak hours, or just peak hours, are specific times when electricity demand is at its highest. This is when electricity rates are the most expensive. In Arizona, peak usage periods are usually during weekday afternoons and evenings, with slight variations in times depending on your utility provider:
See: Is Solar Worth it in Arizona? (2025 Homeowner's Guide)
Off-peak hours are times when electricity demand is lower. In other words, it’s the cheapest time to use electricity. Like peak hours, off-peak hours vary depending on the utility:
Peak and off-peak hours in Arizona change with the seasons and shifting energy demands.
During the summer, when air conditioning use is at its highest, peak hours typically fall in the late afternoon and early evening when temperatures reach their peak. In the winter, energy demand shifts to the early mornings and evenings – the coldest times of day when homes and businesses rely more on heating to stay warm.
Because of this, utility companies adjust their TOU rate schedules seasonally, meaning the cheapest time to use electricity in Arizona can change depending on the time of year.
Most utility companies in Arizona offer lower, off-peak electricity rates on weekends and major holidays like Memorial Day, the 4th of July, Labor Day, Thanksgiving, Christmas Day and New Year’s Day. This means you can take advantage of cheaper energy costs during these times.
Some utility rate plans in Arizona include a monthly demand fee. Like standard Time-of-Use (TOU) plans, TOU + Demand plans calculate your total energy usage by adding up the total on on-peak and off-peak kilowatt-hours (kWh) used during the billing cycle. However, TOU + Demand plans also include a charge based on your highest single 30-minute (SRP) or 60-minute (APS) window of energy use in that same billing cycle.
While demand fees may seem daunting, these plans typically offer much lower per-kWh rates than standard TOU plans. The key to saving money is to avoid using multiple high-energy appliances at the same time—for example, turning on the air conditioner, dryer, and oven simultaneously in a 30-minute or 60-minute window during on-peak times (Demand fees are only assessed during on-peak hours).
Solar batteries can help minimize demand fees by discharging stored energy during peak hours, reducing both demand charges and high on-peak kWh costs.
Read More: Batteries or Generators: Which Backup Solution is Best for Your Home?
The below table summarizes the cheapest time to use electricity in Arizona based on the off-peak hours of different utility providers:
| UTILITY PROVIDER |
OFF-PEAK TIME PERIODS (CHEAPEST ELECTRICITY) |
WEEKENDS & HOLIDAYS |
| Salt River Project (SRP) |
Before 2 p.m. and after 8 p.m. |
Off-peak all day on weekends & six major holidays |
| Arizona Public Service (APS) |
Before 4 p.m. and after 7 p.m. |
Off-peak all day on weekends & 12 designated holidays |
| Tucson Electrical Power (TEP) |
In winter, before 6 a.m., between 9 a.m. and 6 p.m., and after 9 p.m. In summer, before 3 p.m. and after 7 p.m. |
Off-peak all day on weekends and major holidays. |
| UniSource Energy Services (UES) |
In winter, before 6 a.m., between 9 a.m. and 3 p.m., and after 7 p.m. In summer, before 3 p.m. and after 7 p.m. |
Off-peak all day on major holidays |
To take full advantage of TOU pricing, you’ll need to be strategic about when and how you use electricity.
Below are some simple tips on how to make the most of TOU rates to enjoy cheaper electricity:
Set your dishwasher, washing machine, and dryer to run overnight or in the early morning. If you own an electric vehicle, take advantage of cheaper rates to charge your EV at night.
If you rely on air conditioning in the summer, set your thermostat to cool your home in the morning, then raise it slightly during peak times to use less electricity.
Devices like water heaters, pool pumps, and EV chargers can be scheduled to run when rates are lowest.
If you’re on a TOU + Demand plan you will want to be very careful to not spool up multiple high-energy appliances all at once during on-peak hours. Examples include AC systems, pool pumps, dryers and ovens. Instead stagger their activation over time to prevent large demand spikes in 30-minute (SRP) or 60-minute (APS) windows during on-peak hours.
Most TOU plans offer lower rates on weekends. This can be a great opportunity to use cheaper electricity to do your laundry or other tasks that require energy-intensive appliances.
TOU and TOU + Demand rate plans can make adding solar panels or home battery storage a smart move, as you’ll be able to generate and store electricity when rates are low and use it during peak hours to avoid higher kWh rates and/or demand fees.
For more energy-saving tips, check out our article: How to Lower Your Electricity Bill in Arizona
As we’ve seen, electricity prices can vary throughout the day depending on how much demand is being placed on the grid. Essentially, the periods of time when most people need electricity is when it costs the most.
The good news is, you can take advantage of these fluctuating electricity rates by combining home battery storage with a strategy called time shifting.
Time shifting involves charging your home battery when electricity is cheapest (usually at night) and using that stored energy during high-cost, on-peak hours to avoid demand fees and/or higher kWh rates. This allows you to bypass purchasing more expensive electricity during the day so you can save more on your energy bills.
Here’s how it works:
Most homeowners know that installing solar panels can help reduce energy costs, but not many know that you can opt for just a battery storage system without the panels. This can be a more cost-effective way to benefit from time shifting, with lower upfront costs compared to installing a solar panel system.
Keep in mind, however, that battery storage won’t provide the same power security during grid outages as a battery + solar system. Without solar panels, once your battery is discharged, you won’t be able to recharge it until the grid is restored, which can leave you without backup power during extended blackouts.
See: Should I Get Battery Storage for My Solar Energy System?
For maximum savings on your electricity bill, there’s no better option than pairing your home battery with solar panels. This means you can save money by time shifting while also using your solar panels to charge your battery during the day so that you’re never without energy – even during grid outages.
Because your home is running off solar power through the day, you’ll see even more significant savings than with just a battery storage solution, plus additional security during blackouts.
If you’re looking to reduce your electricity bills in Arizona, you can opt for either a home battery or a battery + solar installation:
If you’d like further guidance on which option is best for you, don’t hesitate to contact our team at Sun Valley Solar Solutions. We provide free consultations for homeowners looking to reduce their electricity costs with solar or home battery storage systems. Our solar and battery experts will assess your energy consumption habits and provide you with several options that meet your needs and budget.
Contact us now to learn more.