Time-of-Use Rate

A time-of-use (TOU) rate is an electricity tariff in which the price per kilowatt-hour varies according to the time of day, the day of the week, and often the season. Utilities use TOU pricing to discourage consumption during high-demand windows: on-peak hours can cost several times more than off-peak hours, with the gap sometimes reaching 3× to 5× or more between the cheapest overnight rate and the most expensive afternoon block.

A structural advantage for miners

For most consumers TOU is just a schedule to live around. For Bitcoin miners it is a lever. Because ASICs can be powered up and down on demand, an operator can run at full hashrate during cheap off-peak hours and throttle or shut down entirely when prices spike. Done well, this pulls the blended cost of power down toward the off-peak rate rather than the flat average, materially improving margin on every coin mined.

Implementation considerations

Capturing the benefit requires automation — scheduling tied to the utility's published TOU calendar, or smarter still, to real-time price signals — plus hardware that tolerates frequent power cycling without harm. There is a trade-off: idle machines earn nothing, so the savings from avoided peak power must outweigh the lost hashrate. The math favors TOU optimization most where the peak-to-off-peak spread is wide.

TOU strategy works best alongside an understanding of demand charges and a willingness to operate as a curtailable load that the grid can lean on.