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2023-01-30 06:11:36

Could an hourly rate contract be a good idea for you?

An hourly rate contract follows the hourly rate prices on the electricity exchange, and may vary greatly over time. Among other things, it depends on the season, but also depends on rainfall and wind. Electricity is often more expensive in winter than in summer in the Nordic Region.

A normal weekday during the winter months normally contains two price peaks

The first is in the morning when most electricity customers wake up, cook breakfast, and get ready for the day. The second is at the end of the day when most people get home from work and cook dinner, start the dishwasher, and so on, all at the same time.

To move cooking to during cheaper hours of the 24-hour day may prove difficult. On the other hand, in an electrically heated house, for example, you could avoid running at full capacity during the most expensive hours of the 24-hour day by using some type of automation for the heat pump.

There are also other ways to switch consumption from expensive hours to cheaper hours

You can do this on your own, with the help of your electricity supplier, or with the help of an energy service company (or an aggregator) that specialises in this particular field. Someone with an electric car can take advantage of the price differences throughout the 24-hour day by putting it on charge when the electricity is cheaper.

For example, by moving half of the consumption of an electrically heated house from the most expensive hours to hours just before or after, the household's energy cost could be reduced by 10–20 per cent (excluding the cost for networks and taxes).

The difference between a monthly-based variable price and an hourly rate contract

With a monthly electricity price, you pay the same electricity price per kWh throughout the month (an average of the month's hourly rate prices, illustrated by a straight line in the graph).

With an hourly rate, the prices instead vary by the hour. In order for the contract to be advantageous, it is important to avoid the most expensive hours (for consuming electricity), and instead consume during the cheapest hours.