Economy 7 Tariffs explained: what it is and how it works

Cut your night-time energy bills with Economy 7 today

A quick read on real savings

Economy 7 can lower bills by shifting electricity use to cheaper night hours. If you heat with storage heaters or charge an EV overnight, the numbers can work in your favour. Here is what to know, how to qualify, and how to switch with confidence.

Understanding unit rates is only half the story. What matters is when you use power.

Who benefits most

Households that can move significant usage to night-time typically save most. Think storage heaters warming overnight, immersion heaters topping up hot water off-peak, or EVs charging while you sleep. If most of your usage happens during the day, a single-rate plan may be better value.

The essentials in plain English

Economy 7 is a dual-rate electricity tariff with two prices: a cheaper off-peak rate overnight and a higher rate during the day. Off-peak usually spans seven hours, commonly around midnight to 7 am, though exact times vary by region and supplier.

• Off-peak unit rates often sit around 7-12p per kWh.
• Peak daytime rates are typically higher at about 25-30p per kWh.
• To make it pay, many households need at least 40 percent of usage overnight.
• You will need either a dual-rate meter or a compatible smart meter able to record day and night consumption separately.
• Traditional RTS meters are being phased out, with upgrades to smart meters required by June 2025.

Ofgem’s price cap still applies to Economy 7. It limits what a typical household pays overall, but suppliers can set different day and night rates within the cap. That is why comparing deals matters.

Bold takeaway: if you can shift usage reliably, Economy 7 can be cost effective without changing your lifestyle dramatically.

Your choices on the table

Economy 7 is not the only route. Weigh it against standard single-rate tariffs and supplier variations.

What varies most between suppliers is the spread between night and day rates. A sharper discount at night often comes with a steeper daytime rate. If your pattern is borderline, a softer spread might be safer.

Tip: check the off-peak window start and finish times. They may not match exactly to midnight through 7 am in your region.

Pounds and pence - what it could mean

• Savings potential: around £45 per year for households that move a meaningful share of usage off-peak. Heavy night users can sometimes do better.
• Price cap: Ofgem caps typical annual costs but not the balance between day and night pricing. That is why comparing multiple Economy 7 deals is essential.
• Returns: those with EV charging or storage heaters tend to see the clearest gains because large loads move easily into off-peak.
• Risks: if your lifestyle changes or you end up using more during the day, you could pay more overall than on a single-rate tariff.

Rule of thumb: aim for at least 40 percent of your electricity overnight. Below that, the higher daytime rate can outweigh the night discount.

Can you get it

You are a good candidate if you:

• Have storage heaters, an immersion heater, or an EV charger you can schedule overnight.
• Can run appliances like washing machines, dishwashers, or dryers during off-peak hours safely and considerately.
• Have or can install a dual-rate or smart meter. If you still have an RTS meter, plan to upgrade before June 2025.

You might reconsider if you:

• Are at home all day and cannot shift usage out of peak hours.
• Prefer simplicity over scheduling or do not want to manage timers.
• Live somewhere where off-peak hours are inconvenient for your routine.

Make it work in 7 steps

1. Check your current day vs night usage pattern.
2. Confirm you have a dual-rate or smart meter.
3. Verify your region’s off-peak window times.
4. Price compare multiple Economy 7 suppliers.
5. Model costs using your actual kWh split.
6. Set appliance and EV charging schedules overnight.
7. Review bills monthly and adjust usage.

Upsides and trade-offs

Pros:

• Cheaper unit rate overnight for energy-heavy tasks.
• Encourages efficient habits and smart scheduling.
• Works neatly with EVs and storage heaters.
• Covered by Ofgem’s price cap for typical usage.

Cons:

• Higher daytime rate can offset gains if patterns slip.
• Off-peak hours vary by region and supplier.
• Requires a compatible meter and sometimes an upgrade.
• Noise or neighbour considerations for night-time appliances.

Read this before you switch

• Compare at least three suppliers. The split between day and night rates varies widely, even under the price cap.
• Confirm the exact seven-hour off-peak window for your area.
• Check that timers and smart plugs work reliably with your appliances.
• Plan a meter upgrade if you still use an RTS meter. Smart meters are required as RTS is phased out by June 2025.
• Test your usage split for a month. If you cannot reach about 40 percent overnight, Economy 7 may not pay.

Savings come from behaviour, not just from the tariff.

If not Economy 7, then what

• Single-rate electricity tariff: simpler, often better for daytime-heavy homes.
• Time-of-use smart tariffs: some suppliers offer more granular off-peak windows or EV-specific overnight rates.
• Energy efficiency upgrades: insulation, smart heating controls, LED lighting reduce overall kWh, whatever the tariff.
• Load shifting without tariff change: schedule appliances overnight if your supplier has any off-peak incentives.

Common questions

Q: What hours count as off-peak on Economy 7? A: Typically seven hours overnight, often around midnight to 7 am, but exact times depend on your region and supplier.

Q: Do I need a new meter? A: Yes, you need a dual-rate or smart meter that records day and night separately. RTS meters are being phased out and should be upgraded by June 2025.

Q: How much could I save? A: Around £45 a year for suitable users, with more possible if you charge an EV or run storage heaters mainly overnight.

Q: How do Ofgem caps affect Economy 7? A: The price cap limits typical annual costs, but suppliers set the day and night rates within that cap. Always compare before switching.

Q: What percentage of usage should be off-peak? A: Aim for at least 40 percent. If you cannot reach that consistently, a single-rate plan may be cheaper overall.

Q: Are appliances safe to run at night? A: Use modern appliances with delay timers and observe safety guidance. Consider noise and local regulations.

What to do next

• Audit your last 12 months of kWh usage by hour if possible.
• Get quotes from multiple suppliers for Economy 7 and single-rate.
• Trial a 2-week off-peak routine with timers and EV charging schedules.
• If the numbers add up, switch through a reputable comparison site and set reminders to review quarterly.

Important note

This guide provides general information for GB households and is not personalised advice. Tariffs, meter availability, and price cap levels change. Confirm details with your supplier before switching and consider professional advice for complex setups.