Economy 7 is a type of electricity tariff that offers an off-peak and peak price for the units of electricity you use depending on the time of day you use them. Cheaper rates are typically offered during the night during a seven-hour window. It is most cost effective tariff if over 50% of your energy usage is at night.
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.
It’s called an Economy 7 tariff as 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.
When Economy 7 is uneconomic
If you’re using energy during the peak hours then you’ll pay more for that than customers who are on a more standard tariff. That 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.
The charge for using energy during peak times could quickly offset the savings you make using the discounted night-time energy.
You could also 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.
It’s also 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 to 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 quickly 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. 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.
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 do I know if I’m on Economy 7?
If your energy bills seem high and you’re wondering whether you’re on an Economy 7 tariff but not using power at night then you should take a look at your bill.
An Economy 7 bill will list night-time and day-time readings, but you can call your provider if you’re not sure.
How can 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 work smartly. 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 which hours you should be using energy.
- 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 are only using energy when they are supposed to. The only exception to that rule is tumble dryers, which fire fighters warn can be a fire risk if they are left 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.