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Are you on an Economy 7 tariff? Find out how you could get cheaper bills.
If you’ve recently moved into a new property and it turns out you’re on an Economy 7 electricity tariff, you might not be sure what this means. Will your bills be more expensive or could they work out cheaper?
Economy 7 tariffs mean you pay a cheaper price for your electricity during the evening and at night. This means smart use of your electricity could save you a decent amount of money on your electricity bills. But if you do it wrong and just use electricity as normal, it will work out more expensive. Let’s look at how you could get cheaper bills on Economy 7.
What is Economy 7?
With Economy 7, you’ll pay for energy at two different rates, depending on whether it’s the day time or the night time. The night time rate is quite a bit cheaper than the day time rate, so if you use more energy at night, you can save money.
To show you how this works, take a look at this electricity cost calculator from UK Power. If you used a typical washing machine for 20 hours a month on a day rate of 13p per kWh, you’d pay £3.12 to use it. But if you only used it at night for the same amount of time on a rate of 7p per kWh, this would be £1.68 a month. That works out at an average saving of £1.44 each month.
That might not sound like a lot but if you work it out over the year, it’s an average of £17.28. And that’s just for one appliance. If you started using more of your household appliances during the night rate, it could work out cheaper on an Economy 7 tariff.
If you’re looking to switch to Economy 7 from a standard tariff, you’ll probably have to get a new meter installed. Your supplier might charge you for this, so look around for an electricity provider who will put in a new meter for free. The same applies if you’re already on Economy 7 and want to switch to a different tariff – so it’s important you’re really sure you want to move to Economy 7 before you switch.
How to save money
You don’t have to become a night-owl to save on Economy 7 – you can program certain appliances to switch on when you’ve gone to bed. For example, if your washing machine has a timer, you could set this in the evening and it would turn itself on during the night rate.
If your washing machine or other appliances don’t have this option, you could get a timer plug. This goes into the socket and you plug your appliance into it, meaning you can then control the time it comes on. This means you can make the most of the cheaper energy at night.
It’s also best if you have a storage heater for your hot water, as this can be set to come on overnight. You’ll then be able to use hot water throughout the day but you’ll have paid less to heat it.
Is it cheaper for you?
Economy 7 could be cheaper for you if your home is set up in the ways we mentioned above – your appliances have timers and your water can heat up at night. This means you can be using at least half of your total electricity consumption overnight so you’re really making the most of the cheaper rate.
But if you don’t have a water heater or appliances with timers, Economy 7 will probably work out more expensive than other tariffs. Unless you’re a shift worker and you typically stay up through the night, you probably won’t be using much electricity during the cheaper rate.
If you’re starting to struggle with the cost of your energy bills, this might be a sign that your finances are becoming unmanageable generally. If you know you won’t be able to afford your energy payments it’s very important that you tell your supplier. You might be able to work together and arrange a payment plan based on what you can afford. There are also grants and benefits available to help with your household costs in some cases. For more information on this, have a look here.
You can get free and impartial advice from the Money Advice Service about dealing with expensive household bills. You can also get in touch with our advisors using any of the options on the left if you’re starting to find all of your financial commitments difficult to afford.
by Emily BancroftBack to blog home