What is Economy 7?
Economy 7 is a type of electricity tariff that offers you cheaper electricity at night, but a higher rate during the day. The precise hours vary by supplier, but you’ll often get the cheaper rates between midnight and 7 am.
If a good chunk of your energy usage happens after midnight, you can save a lot of money with an Economy 7 tariff. However, rates for daytime energy use are much higher than with an ordinary tariff.
How does an Economy 7 tariff work?
Economy 7 tariffs are generally cheaper than other price plans because you commit to using most of your energy at night and you get a decent discount for the units you use during the off-peak hours.
They are most suitable for people with storage heaters and a hot water tank, as these can be heated up at night when it’s cheapest and then used to provide hot water and heating throughout the next day.
Many modern appliances also feature timers, so you can set your washing machine or dishwasher to run during the off-peak window.
It’s called an Economy 7 tariff because the off-peak window is usually a seven-hour period, often between midnight and 7am, although it can vary depending on the provider, location and even the time of year.
Unfortunately, if you’re not using much energy at night then an Economy 7 tariff can mean you’re paying far more than you need.
How do I know if I’m on Economy 7?
Over 3.5 million households have an Economy 7 meter installed, and some people might already be on an Economy 7 tariff without realising. If you’re on Economy 7 without making the right adjustments to your energy use, you could be paying over the odds for energy. If your bills seem high and you’re wondering whether you’re on an Economy 7 tariff, you should take a look at your bill.
If you’re on Economy 7, your bill will have separate readings for ‘electricity – day’ and ‘electricity – night.’ Your bill will also have a Meter Point Administration Number. If the first number on the top line is 02, then chances are you’re on an Economy 7 tariff.
If you’re confused by any part of your bill, you can always phone your provider – they can give you all the information you need.
Can I save money with Economy 7?
According to Ofgem, the average UK household uses 42% of its energy at night. Depending on the precise hours of your Economy 7 tariff, this means you could potentially save around £30 a year on energy.
You can increase your savings by shifting more of your energy usage to the off-peak period. Setting appliances to run at night makes them much cheaper, and a storage heater or hot water tank can heat water at night for use throughout the day.
However, you might find that heating water and storage heaters at night doesn’t provide enough warmth to last a full day, meaning your house could get chilly in the evenings when the Economy 7 heating has run out. It’s a tariff more suited to people who favour a shower first thing rather than a long luxurious bath in the evening.
Using too much energy during peak hours will quickly become expensive – and it could cancel out any savings you make at night. You’ll be charged a much higher rate during peak hours than customers on a more standard tariff. This means that if you’re not suited to an Economy 7 tariff you could end up paying far more overall than you would on another deal.
It’s only a good deal if you can be quite strict with yourself, perhaps by installing timers on your appliances so you don’t use them during the day.
How do I switch to or from an Economy 7 meter?
Energy companies are not pushing Economy 7 tariffs as enthusiastically as they used to, but you can still request to move onto one. This means having a new, special meter installed and there may be a small charge for that but many providers will offer it free of charge.
It’s a good idea before you get one installed to find out whether you’d have to pay to switch back, just in case you discover that Economy 7 isn’t right for you.
But if you’re on this kind of tariff already and it doesn’t suit your energy use, then it is possible to switch away – most providers won’t charge to change your meter back, but you don’t have to stick with your current provider if they do. You can compare energy tariffs for your home using our price comparison page.
You may automatically get switched to the provider’s standard tariff when you make the move, so be sure to compare deals so you don’t pay more than you need.
If you’re happy with an Economy 7 deal then you can still check you’re with the cheapest provider. Paying less for off-peak energy is great, but paying even less for that off-peak energy is better.
Switch and save with Energy Monitor
Switching your energy supplier is quicker and easier with MoneySuperMarket’s Energy Monitor tool. We’ll let you know as soon as there’s a cheaper tariff available for you, so you can effortlessly switch and save money on your energy bill.
What are the alternatives to Economy 7?
If an Economy 7 tariff isn’t right for you then there are alternatives. Some providers offer an ‘Economy 10’ tariff, which gives you a longer discounted period, often including some daytime hours – which can make it more workable for a busy household.
In an Economy 10 deal, you’ll often get the off-peak rate at several points during the day, rather than for seven solid hours. So, for instance, you might get cheaper energy between midday and 3pm, again between 5pm and 7pm, and again between midnight and 5 =am.
Economy 10 packages aren’t always available to new customers, but if you’re already on an Economy 7 tariff and are worried about your daytime usage, it might make sense to switch.
But often, just finding the cheapest deal for your specific household can save hundreds of pounds a year, so it’s worth taking a few minutes to compare and switch. There won’t be any break in your supply and you can apply online or by telephone.
How can I make Economy 7 work for me?
If you’re on an Economy 7 tariff and want to get the best possible savings out of it, you need to be smart with your energy use. Here are our top tips:
- Check with your supplier exactly which hours are discounted: Discounted hours can vary from supplier to supplier, so make sure you know exactly when energy is cheap, and when it’ll be more expensive
- Keep an eye on the clocks changing: Be careful when the clocks change so you don’t run all your appliances an hour too soon
- Charge your gadgets at the right time: Charging up your gadgets at night and installing timers to your appliances like washing machines will ensure they’re only using energy when it’s cheaper. The only exception is tumble dryers, which fire fighters warn can be a fire risk if left to run unattended
- Invest in a smart meter: Ask your energy company if they can issue you with one, as a smart meter will let you see how much power you’re using at any one time, helping you adjust your usage to fit your discounted deal