The ultimate guide to Economy 7

Last updated: 26 April 2021

Find the answers to your questions about switching to Economy 7 energy in this guide:

  • What is Economy 7?

  • What’s the difference between Economy 7 and standard energy tariffs?

  • How do I read my Economy 7 meter? Can I get an Economy 7 smart meter?

  • What are the Economy 7 rates?

  • Is Economy 7 the right energy tariff for me?

  • How do I switch to an Economy 7 tariff?

  • How do I switch back to a standard tariff from Economy 7?

What is Economy 7?

Economy 7 is a differential or ‘multi-rate’ tariff. This means that you pay separate rates for your electricity depending on the time of day that you use it. With this type of tariff, you pay slightly higher rates during the day and cheaper rates for a set seven-hour period at night (hence the name ‘Economy 7’). Essentially, your meter tracks your daytime and night-time usage of electricity separately, allowing you to pay different rates depending on when you use it. Think of it like peak/off-peak phone calls, but for electricity. 

What is an Economy 7 meter? 

Economy 7 meters display two sets of numbers: ‘normal’ and ‘low’, or ‘rate 1’ and ‘rate 2’. Normal/rate 1 denotes your day rate for electricity, while low/rate 2 indicates the rate you pay overnight. You’ll need to have one, or have one installed by your supplier, to switch to Economy 7.

There are two types of Economy 7 meters, so the way you read your meter depends on the type you have: 

  1. Two rows – The top row displays your “normal” rate. The bottom row displays your “low” rate. 

  2. One row – There is one row that displays your “normal” rate. To see your “low” rate, simply press the red button. 

How does Economy 7 work? 

If you’re using an Economy 7 meter, it costs more to use electricity during the day than it does at night. By scheduling your most electricity-intensive appliances to run at night, such as washing machine, dishwasher, tumble dryer or electric vehicle charger, you can save a significant amount of money compared to being on a standard rate tariff. It’s a particularly good fit for those who heat their home using electricity using suitable Economy 7 heaters such as underfloor heating or electric storage heaters.

It does rely on you changing the way you use electricity – if it’s impractical for any reason (for example, a noisy washing machine that would keep you awake at night), then this type of energy tariff could be a more expensive option. 

What’s the difference between Economy 7 and standard energy tariffs? 

With standard energy tariffs, customers are charged the same rate for each kWh of electricity consumed, regardless of when it’s used. Economy 7 units are basically more expensive during the day, and cheaper during a seven-hour period at night. If you’re on this kind of tariff, it’s more cost-effective to do your laundry, run your dishwasher, charge your electric vehicle and perform other non-time-sensitive tasks outside of regular hours. Is electricity cheaper at night? Yes, it can be if you’re on Economy 7.

How do I find out if I’m on an Economy 7 tariff? 

The simplest way to find out is to check your electricity bill to see whether it displays two separate tariffs – one for the daytime, and one for night. If it does, you’re already on an Economy 7 tariff. Alternatively, check your electricity meter to see if it displays two separate numbers, one marked ‘normal’ and the other ‘low’, to confirm you’re on the tariff.

Can I get an Economy 7 smart meter? 

Yes, but not all suppliers currently offer one or recommend you get one. Basically, the newer generation of smart meters – SMETS2 – work with Economy 7 tariffs, although some SMETS1 meters also support multi-rate tariffs.

These days, even if you’ve got storage heaters or underfloor heating, which used to make it impossible to install an Economy 7 smart meter, there are new types of smart meter that can be fitted to these systems. Again, however, it’s very much dependent on your electricity supplier. 

Which suppliers offer an Economy 7 smart meter?

As a rule of thumb, if your supplier offers a second-generation (SMETS2) smart meter, it should work with Economy 7 tariffs. If you’re not sure, your supplier isn’t covered below, contact it for confirmation.

SupplierStatus
British GasYes
E.ONYes
SSE Yes (Smart Economy 9 tariff)
EDFYes
ScottishPowerNot recommended
OVO EnergyYes
Bulb “We hope to be able to offer 2 rate tariffs on our smart meters in the future.”

What are the peak and off-peak hours for Economy 7? 

Economy 7 times differ depending on which energy supplier you’re with and where you live – the most common off-peak periods are: 

  • 11pm-6am

  • 12.30am-7.30am

  • 1-8am

  • 1.30-8.30am

As always, double-check with your supplier. Many meters make an audible click when switching from peak to off-peak rates and back again, which may give you a clue.

Remember, off-peak electricity times may change when the clocks go back or forward – something to keep an eye on. For example, during the winter (Greenwich Mean Time) your off-peak hours may be between 12 midnight and 7am, but when the clocks go forward for British Summer Time, your Economy 7 times will switch to between 1am and 8am.

What are the Economy 7 tariff rates? 

These depend on individual suppliers and where you live in the UK – the difference in cost between peak and off-peak Economy 7 rates can be as much as 50% though. If you use a large proportion of your electricity overnight, you could enjoy significant savings. To find out exactly how much you could save with Economy 7 rates, check the individual rates offered by different electricity suppliers or search for ‘Economy 7’ deals when you compare energy with SaveOnEnergy.

Does Economy 7 energy work with gas? 

No, there is no gas version of Economy 7. This is because gas is mostly used for heating, hot water, and cooking, rather than appliances like tumble dryers and washing machines that are much more likely to be used at night. 

How does Economy 7 heating work? 

Economy 7 heating relies on your heating appliances to be run by electricity rather than gas, so they can take advantage of the lower electricity rates. Economy 7 heating works best with electric storage heaters and hot water tanks, because it allows you to heat them up during the night, when electricity is cheaper, and then gradually use the heat throughout the course of the day.

Does Economy 7 work with electric vehicles?

Yes, you could take advantage of Economy 7 to charge your car at night. In fact, most energy suppliers now offer specialist multi-rate tariffs for electric vehicle owners to encourage charging overnight – all of these require or come with a smart meter. Check out our guide to electric vehicles here.

Is an Economy 7 tariff the right choice for me? 

While Economy 7 may help you save money, it’s not the right choice for everybody. Ultimately, it depends on how much electricity you use – or can switch to using – at night. Since rates are higher during the 17 peak hours of the day to balance the lower off-peak rates, you could easily end up spending more on an Economy 7 tariff. Here’s what you need to consider when deciding whether to switch:

  • When do you use most of your energy?

You’ll need to be able to use 40% of your energy during the Economy 7 off-peak period to make it a cost-effective option.

  • What do you use to heat your home?

Economy 7 is ideal if you have electric hot water tanks and storage heaters. Economy 7 heating is probably the most important reason to switch.

  • What kind of appliances do you use?

It’s important that key appliances – dishwashers, washing machines and tumble dryers – have timers. Otherwise you’ll have to stay up late to manually switch them off during the off-peak period.

  • What’s your lifestyle like?

If you’re a shift worker who regularly sleeps during the day, you may find switching to Economy 7 a good way to save money because you naturally use most electricity during the small hours.

  • Do you need a warm, cosy home at night?

If so, then Economy 7 may not be viable because both hot water and stored heating may be already starting to cool as evening comes around.

Some customers believe that Economy 7 limits the options they have when selecting a new energy deal, though Wendy Simkins on TrustPilot had no problems finding a deal that enabled her mother to save money:

"Did this for my Mum so she can save some money on her electricity bills. Bulb came up as the best tariff for her; she has Economy 7 heating. Very easy to change suppliers."

Wendy Simkins, TrustPilot

What Economy 7 cost-cutting tips can you share?

Aside from double-checking which hours your Economy 7 tariff run for, and confirming whether or not those times are permanently on GMT or change when BST rolls around, there are many ways you can save money with Economy 7:

  • Charge gadgets during the night: purchase cheap timers to ensure they only charge during the off-peak hours. Mechanical ones can be bought for under £5 from the likes of Screwfix.

  • Check your meter regularly: make sure your meter’s clock is accurate and syncs up with your other clocks so you’re getting cheap electricity when you think you are.

  • Set a small delay: when setting timers, allow a 10-15-minute grace period before switching on and off, to ensure they’re only running when the lower-rate tariff is.

  • Dial down your storage heater: if you have a manual storage heater with a simple input/output dial, set it to its lowest level (1) so it can charge up during the night without releasing any unnecessary heat.

Am I already on an Economy 7 tariff? 

The simplest way to find out is to check your electricity bill to see whether it displays two separate tariffs – one for the daytime, and one for night. If it does, you’re already on an Economy 7 tariff. Alternatively, check your electricity meter to see if it displays two separate numbers, one marked ‘normal’ and the other ‘low’, to confirm you’re on the tariff.

How do I switch to an Economy 7 tariff? 

You’ll need to have an Economy 7 meter installed unless you have an existing smart meter that supports multi-rate tariffs. Get the ball rolling by exploring the different prices offered by suppliers across the UK. Once you’ve found a workable option, contact the supplier to ask them how to make the switch. If you need a new Economy 7 meter, you may have to pay an additional fee for installation, but this shouldn’t be the case if you’re having a compatible smart meter fitted.. 

How do I switch to an Economy 7 tariff? 

You’ll need to have an Economy 7 meter installed. Get the ball rolling by exploring the different prices offered by suppliers across the UK. Once you’ve found a workable option, contact the supplier to ask them how to make the switch. If you need a new Economy 7 meter, you may have to pay an additional fee for installation.

How do I switch back to a standard tariff from Economy 7 energy? 

You’ll need to switch back to a non-Economy 7 meter (not necessarily a problem if you’re happy to switch to a smart meter, but it may involve an additional installation cost. Check with your prospective supplier before switching). It’s also likely you’ll need to meet your supplier’s acceptance criteria to be eligible to switch. Again, get in touch with your supplier for details. 

What about Economy 10? 

If you’re considering Economy 7, you may also be interested in Economy 10, which is sometimes known as Heatwise. The tariff is like Economy 7, but Economy 10 gives you 10 hours of low-cost electricity instead of seven. Three of these hours are in the afternoon, with the remaining seven overnight, meaning there are three separate unit rates instead of two. 

Are there any other similar tariffs available? 

Octopus Energy has just launched its agileOctopus tariff with “plunge pricing”. It’s aimed at anyone who can shift their electricity usage away from the 4-7pm peak time each day. The aim is to encourage users to take excess energy off the grid during times of lower demand, to help balance usage with renewable energy generation. It’s linked to half-hourly changes to wholesale energy prices, which surge and dip during the day according to demand.

Octopus imagines the future of energy pricing to follow this model, with people adjusting demand to fit available capacity. Find out more about the tariff at its website.

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Published on Wed 23 Oct 2019 03.30 GMT