Tiered Rate
An electricity pricing structure where the per-kWh rate increases as you use more power within a billing period, divided into usage tiers (e.g., Tier 1: 0-500 kWh, Tier 2: 501-1000 kWh).
Why It Matters
Solar is especially valuable under tiered rates because it offsets the most expensive top-tier usage first, maximizing dollar savings per kWh produced.
Real-World Example
Related Tools
Related Terms
Time-of-Use (TOU) Rate
An electricity pricing structure where rates vary by time of day. Peak hours (usually 4-9 PM) have higher rates.
Baseline Allowance
The amount of electricity a utility allocates at the lowest rate tier, based on your climate zone, season, and heating source. Usage above baseline is billed at higher tiers.
Flat Rate
An electricity pricing structure where the same per-kWh rate applies regardless of usage amount or time of day. Simpler but less common than tiered or TOU rates.