Economy 7 Tariffs for beginners: a step by step starter guide

Economy 7 Tariffs for beginners: a step by step starter guide

Understanding rates is not just about pence per kWh - it is about when you use power.

At a glance

Economy 7 offers cheaper electricity at night and higher prices during the day. If you can shift a meaningful chunk of usage into the seven off-peak hours, you could lower bills. If you cannot, you may pay more overall. Here is how to judge it, step by step.

Who this guide will actually help

Households in Great Britain that can run high-energy tasks overnight - think storage heaters, immersion heaters, dishwashers, washing machines, tumble dryers, or EV charging. Renters and homeowners considering a meter upgrade. Anyone comparing day-night tariffs against a single-rate deal and wanting a clear, trusted framework to decide.

Key concepts you need to know

• Dual-rate tariff: Economy 7 has two prices - a cheaper off-peak night rate and a pricier day rate.
• Off-peak window: Typically a continuous 7-hour period, often around midnight to 7am, but times vary by supplier and region.
• Usage split: Savings usually rely on moving at least 40% of your electricity to off-peak hours.
• Typical price spread: Night rates can fall to roughly 7-12p per kWh, while day rates may sit around 25-30p per kWh. Your supplier’s rates will differ.
• Metering: You need a dual-rate meter or a smart meter set up for day-night readings. Traditional Radio Teleswitch meters have been scheduled for phase-out by 30 June 2025 - check if you need an upgrade.
• Price cap context: Ofgem’s cap limits the annual cost for a typical Economy 7 household but does not set the exact day or night unit prices. For Oct-Dec 2025, the typical cap is £1,179 when paying by Direct Debit.

Aim for at least 40% of usage at night to unlock value.

Your tariff choices compared

Some suppliers use different time bands or alternatives like Economy 10. Compare carefully.

• Off-peak times vary by region and supplier. Ask for exact hours before switching.
• Smart meters make tracking and automation easier and reduce billing errors.

Pounds, impact, and real-world risk

• Savings potential: Night units can be 20-33% cheaper than day units, sometimes more. If you regularly charge an EV or heat water overnight, savings add up fast.
• Break-even point: If you cannot shift roughly 40% of use to nights, higher daytime rates may outweigh benefits.
• Bill protection: The Ofgem cap provides a ceiling on typical annual costs for Economy 7 users, but suppliers set different day-night prices. Your pattern decides the outcome.
• Risk factors: Families home all day, electric ovens at lunchtime, or extensive home-working may face higher bills on Economy 7.

Cheap nights are only a win if your days do not cost you more.

Are you a good fit?

Consider your lifestyle and appliances.

• Strong candidates

  • Homes with electric storage heating or immersion heaters
  • EV owners able to schedule charging overnight
  • People using timers on laundry and hot water
  • Night owls on flexible routines

• Weaker candidates

  • Daytime-heavy households or hybrid workers running appliances during the day
  • Properties with limited ability to automate usage
  • Anyone unable or unwilling to change habits

• Meter readiness

  • You will need a dual-rate or smart meter configured for Economy 7. If you still have an RTS-based setup, contact your supplier to upgrade.

Switching in simple steps

1. Check your current meter and tariff details.
2. Request your supplier’s exact off-peak times.
3. Estimate your night-time usage potential.
4. Compare day-night unit rates across suppliers.
5. Confirm Ofgem-cap compliant standing charges.
6. Arrange smart meter install or reconfiguration.
7. Set timers and test an overnight schedule.

Upsides and downsides at a glance

• Pros

  • Night units can be substantially cheaper
  • Works brilliantly with EVs and storage heaters
  • Encourages energy-efficient, grid-friendly habits
  • Smart meters make automation straightforward

• Cons

  • Day rates are higher than single-rate deals
  • Off-peak hours can feel restrictive
  • Mis-timed usage drives bills up
  • Regional and supplier variations complicate comparisons

Watch-outs before you commit

• Off-peak window: Verify exact hours for your region and meter. A mismatch between your lifestyle and the window undermines savings.
• Appliances: Check that heaters, immersion tanks, and EV chargers can run on timers without comfort or safety compromises.
• Standing charges: Some Economy 7 deals have different standing charges - factor them into comparisons, not just unit rates.
• Metering tech: If you rely on an older teleswitch, plan your smart meter upgrade promptly.

If most of your power is used between breakfast and dinner, stick with a single-rate.

Alternatives if Economy 7 is not ideal

• Single-rate fixed or variable tariffs - simpler budgeting if your usage is daytime-heavy.
• Economy 10 - ten off-peak hours split across day and night, available from fewer suppliers and requiring specific metering.
• Time-of-use EV tariffs - ultra-cheap night charging windows tailored to drivers.
• Demand-flexibility events - occasional rewards for shifting use, often visible in smart meter apps.

Frequently asked questions

• What are typical Economy 7 off-peak hours? Off-peak hours usually fall overnight for seven continuous hours. Exact times vary by supplier and region, so always confirm your meter’s schedule.

• How much of my usage should be at night? As a rule of thumb, at least 40% off-peak usage improves your chance of saving. EV charging or storage heating can help you reach that threshold.

• Do I need a special meter? Yes. You need a dual-rate meter or a smart meter configured for day-night billing. Older RTS meters were scheduled to be phased out by 30 June 2025, so contact your supplier if unsure.

• Does the Ofgem price cap apply? Yes, the cap covers typical Economy 7 users but does not fix the exact night or day rates. For Oct-Dec 2025, the typical Economy 7 Direct Debit cap is £1,179.

• Will Economy 7 work with solar panels? It can, but the value depends on your generation and export set-up. If solar offsets daytime use, the advantage of cheaper nights may shrink.

• Is Economy 7 good for heat pumps? Possibly, especially with thermal stores or pre-heating overnight. Check the pump’s controls and tariff timing to avoid expensive daytime top-ups.

What to do next

• Audit a normal week’s usage to estimate your achievable night-time share.
• Get your supplier’s exact off-peak hours and day-night rates. Compare at least three offers for your region.
• Ask for a smart meter if you do not have one. Configure timers for hot water, storage heaters, laundry, and EV charging. Review bills after one month and adjust.

Important information

This guide is for general information only and is not personalised advice. Prices, hours, and eligibility vary by supplier and region. Always verify meter compatibility, off-peak windows, and tariff terms with your provider before switching.