DENVER (KDVR) — A cool home in Colorado summer is about to get more expensive.
Xcel Energy, which supplies electricity and natural gas utilities for a majority of the Denver metro, is introducing a new pricing system for 310,000 Coloradans. By 2025, all its Colorado customers will have the option to join the so-called Time of Use pricing system, which charges different electric rates for power used during different times of the day.
The new rates will have their heaviest impact in the hottest part of summer days.
Currently, Xcel’s residential electricity rates are the same throughout the day — 13 cents per kilowatt-hour in the summer and 12 cents in the winter.
Under the Time of Use plan, rates will go up during the times when people most use it and down in the off hours.
“Mid-peak” hours are between 1 p.m. and 3 p.m., while “on-peak” hours are between 3 p.m. and 7 p.m. “Off-peak” hours are between 7 p.m. and 1 p.m.
Winter prices will be 10 cents per kilowatt-hour for off-peak hours, 14 cents for mid-peak and 17 cents for on-peak. Summer prices will be 10 cents per kilowatt-hour in off-peak hours, 19 cents for mid-peak and 28 cents for on-peak.
Xcel encourages its customers to change their habits to shift electricity use to the cheaper off-peak hours. Among other strategies, the company recommends doing laundry or running the oven or dishwasher later in the evening.
Keeping a home cool, though, will take some effort to avoid new costs.
Central air conditioning uses about 3.4 kilowatts per hour during the summer months, according to American Home, Water and Air.
In the current pricing, it costs $2.65 to run an AC unit from 1 p.m. to 7 p.m. Under the Time of Use pricing model, it would cost $6.46 to run the unit for the same amount of time.