Economy 7 Guide: What is an Economy 7 Tariff?
Will an Economy 7 meter save you money? If you’re on an Economy 7 tariff, you’re charged different prices for electricity at different times of day. Economy 7 can both cost you money or save you money, depending on your lifestyle. Read our ultimate guide on Economy 7 to decide whether it’s the right tariff for you.
What is Economy 7?
Economy 7 is an electricity tariff that charges more for electricity used in the day and less for electricity used at night.
The cheaper night-time electricity rate runs for seven hours, usually from midnight to 7am. Which is why it’s called Economy 7! The difference between off-peak and peak electricity rates can be as much as 50%, depending on your supplier.
What is an Economy 7 meter?
You’ll need to have a certain type of meter to be on an Economy 7 tariff. Economy 7 meters have two sets of numbers, one labelled ‘normal’ or ‘day’ and another ‘low’ or ‘night’. These represent the different rates for different times of the day.
How does Economy 7 work?
Economy 7 meters work by charging different rates for different times of day. During the daytime, you’ll be charged a ‘normal’ rate which will be higher than at night. This ‘normal’ rate tends to be higher than standard daytime rates on other tariffs, so it’s important to keep this in mind.
The ‘low’ night rate will last for seven hours, usually sometime between 10:30pm to 8:30am. The exact time depends on your supplier.
So, you can’t automatically save money by using electricity at night. You’ll need to have an Economy 7 meter and sign-up for the right tariff.
Economy 7 doesn’t suit everyone’s lifestyle but if you use significantly more electricity at night, you might find that it saves you money.
Does Economy 7 work with gas?
Unfortunately, there’s no gas version of Economy 7, it only applies to electricity use. This is because most gas appliances are used for daytime activities (cooking, hot water and heating).
Electrical appliances such as dishwashers and washing machines are mainly used at night which is why Economy 7 can save people money.
How does Economy 7 heating work?
Economy 7 heating only works if your heating appliances run on electricity, not gas. As a result, Economy 7 is most beneficial if you have electric storage heaters and hot water tanks. You can heat them up during the night and then use the stored heat throughout the day. Electric storage heaters are expensive to run. If you have an Economy 7 meter, you can run them at night and spend less.
This way, you’ll spend less on heating as you’ll be heating your water at night on Economy 7 when the cost of electricity is lower.
How to read an Economy 7 meter
There are two types of Economy 7 meters:
- Two displays - the top row shows your day rate and the bottom row shows your night rate. You read the numbers to get your two separate readings.
- Single row - another type of Economy 7 meter will just show your ‘normal’ day rate usage and you’ll have to press the red button to switch to night.
How do I know if I’m on Economy 7?
If you’re not sure if you’re on an Economy 7 tariff, take a look at your most recent electricity bill. If there are two different rates for day and night on the bill, then you’re on Economy 7.
If you don’t have a bill available, take a look at your electricity meter. There should be two sets of numbers or a button to switch between numbers. These numbers represent the different day and night rates.
Economy 7 times - When does cheaper electricity start?
Economy 7 off-peak cheaper nighttime rates start at different times, depending on your supplier and where you live.
The most common low rate periods are:
Double-check when your off-peak time period starts with your supplier. Then start planning your electricity usage to be during those cheaper off-peak periods.
Remember, your Economy 7 times will change when the clocks go forwards and backwards in the summer and winter. Contact your supplier once the clocks change to confirm the new off-peak times.
Is Economy 7 cheaper? Will I save money on Economy 7?
You’ll only save money with an Economy 7 meter if you use at least 40% of your electricity at night during the lower rate off-peak hours.
Economy 7 standard daytime rates aren’t the cheapest on the market. This means that if you use the majority of your electricity during the day, Economy 7 will be a very expensive tariff for your lifestyle.
If you use at least 40% of your electricity at night, you could be saving around £20 a year on Economy 7 in comparison to other electricity tariffs. Use even more than 40% at night and you could rack in some significant savings!
Economy 7 vs. Standard Tariffs
Standard electricity tariffs will charge you the same amount per kilowatt-hour (kWh) of electricity you use, whether it’s day or night.
Economy 7 tariffs will charge you slightly more per kWh during the day and less during the seven hours overnight.
This means that using electrical appliances such as dishwashers and washing machines is much more cost-effective to do at night on an Economy 7 tariff.
Is Economy 7 worth it?
So, is Economy 7 worth it and better than standard electricity tariffs? The answer depends on your situation and if you use more electricity at night.
Let’s take a look at the pros and cons of Economy 7…
- Reduce bills at night - if you use the majority of your electricity at night, you can cut your bills thanks to the cheaper night rate.
- Cheaper heating - if you have electrical heating such as storage heaters, underfloor heating or electric wet radiators, you can store heat up overnight. This will save you money on heating and is cheaper to run.
- Overnight charging - if you have an electric car, it can cost a lot of money to charge. You can charge it overnight on the cheaper Economy 7 rate and save money.
- Choice - most energy suppliers offer Economy 7 tariffs. This means you have the option to compare and find the best deal.
- Daytime use is expensive - if you use electricity during the day on an Economy 7 tariff, you could wipe out any savings you made overnight. This is because the day rate is usually high.
- Installation - you might have to pay to have an Economy 7 meter installed.
- Inconvenient - If your lifestyle doesn’t suit Economy 7 or your electrical appliances are loud at night - you might find it a hassle.
Is Economy 7 right for you?
Economy 7 isn’t the right tariff for everyone. You’ll need to follow a certain night-owl lifestyle. You’ll also benefit most if your heating appliances run on electricity so you can store heat overnight, paying a cheaper rate.
You could save money on Economy 7 if…
- You have electric heating - you can heat your storage heaters and hot water tanks overnight if they are powered by electricity. You can then use this stored heat the following day.
- You have electric appliances - if you do household chores such as running the dishwasher and washing machine overnight, you’ll save money on the cheaper Economy 7 night rate. It’s best if these appliances have timers so they switch on at night.
- You use at least 40% of your electricity at night - you need to use almost half of your electricity at night to save money on Economy 7. If you use more than 60% of your electricity during the day, this will cancel out any overnight savings you made.
- Your lifestyle - if you work shifts and sleep during the day, then Economy 7 will be perfect as you’ll be active at night.
You should avoid Economy 7 if…
- You don’t have a storage heater or hot water tank - if you can’t store hot water overnight to use during the day, you won’t save much on Economy 7. This is because you’ll need to use the heating during the day, costing you the higher rate.
- You’re home during the day - if you work at home and use the majority of your electrical appliances during the day, Economy 7 won’t make you any savings.
- Your lifestyle regularly changes - if you work different hours each week and don’t know when you’ll be home, you won’t be able to plan your schedule to use more electricity at night. This means you would benefit more from a standard tariff that charges the same at all times.
How to switch to Economy 7
If you’ve decided that Economy 7 suits your lifestyle and to make the switch, the process is simple:
Step 1: Compare energy suppliers
Get on an energy comparison website and search for Economy 7 tariffs. You’ll need to enter a rough percentage of the amount of energy you use at night. The comparison site will then show the best Economy 7 tariffs for your usage.
Compare the cheapest Economy 7 tariff and cheapest regular tariff based on your electricity usage. If Economy 7 is cheapest - go for it!
Step 2: Get in touch with the Economy 7 supplier
Once you’ve chosen the cheapest Economy 7 tariff for you, get in touch with the electricity supplier and ask to switch. The process is the same as switching energy suppliers.
Your Economy 7 tariff supplier will organise the switch with your current supplier. Remember, you have a 14-day cooling-off period if you want to change your mind.
Step 3: Have your Economy 7 meter installed
If you don’t have an Economy 7 meter installed in your home, your new supplier will fit one for you. This usually comes with a cost so bear this in mind.
If you already have a smart meter, your supplier will be able to switch your tariff to Economy 7 without needing a new meter installed.
How to leave Economy 7 and switch to standard
If Economy 7 isn’t working for you and costing more money, then you can switch back to a standard meter and tariff.
Step 1: Get in touch with your current supplier
Switching from an Economy 7 tariff to another isn’t always straightforward. This is because you might sometimes have to meet certain acceptance criteria to make the switch.
Get in touch with your supplier and ask them if it’s possible to switch back.
Step 2: Compare energy tariffs
Before you switch, use a comparison website to find the cheapest tariff available to you. You’ll have to estimate your current energy usage to be presented with the best and most accurate deals for you.
Once you’ve found the cheapest tariff, you can reach out and request to switch from Economy 7 to the new tariff.
Step 3: Have your meter switched
You might have to have a new meter installed. Your supplier will charge you for this and the removal of the Economy 7 meter.
Sometimes you can continue using the same meter when you switch from Economy 7, ask your supplier if you’re ever unsure.
Economy 7 golden rules
Here are some golden rules to follow to make the most out of your Economy 7 tariff…
1. Know your off-peak times
You should know EXACTLY when your off-peak period starts and ends. Double-check with your supplier what the cheaper time is and whether it changes when the clocks go forwards and back.
This way, you’ll be able to maximise on savings as soon as the lower rate period starts.
2. Make the most of the off-peak period
If you want to save with Economy 7, use electrical appliances at night.
Here are some great ways to boost your night time savings:
- Buy timers - you can buy cheap timers online. You can plug your washing machine, for example, into the timer which then plugs into the wall. Your washing machine will then automatically switch on and run overnight. You won’t have to remember to stay up! Many washing machines also come with a delay function.
- Charge overnight - charge all of your gadgets overnight and you’ll save more than if you did during the day.
- Energy-efficient appliances - save even more money when using your electrical appliances by making sure they are energy-efficient.
3. Make sure your Economy 7 meter is right
Older meters can sometimes get thrown out of sync. Regularly check that the off-peak numbers are ticking over at night at the peak rates are ticking over during the day.
If it goes out of sync you could end up paying daytime rates overnight and vice versa. If your Economy 7 meter is wrong, get in touch with your supplier and ask them to fix it.
4. Do meter readings when you get your bill
Estimated readings are often very wrong. Every time you receive your electricity bill, take a meter reading and compare the two.
If you’re underpaying you’ll be hit with a large bill later down the line once your supplier takes a meter reading.
If you’re overpaying, get your money back!
5. Check if you can get a smart meter
There isn’t a dedicated Economy 7 smart meter but your supplier might be able to install one to charge different rates at day and night.
The in-home display that comes with a smart meter allows you to track exactly how much energy you’re using in real-time. This is handy during the more expensive daytime rates on Economy 7. You can make sure that your usage is low during the day.
Read our in-depth guide for more information on smart meters.
What’s Economy 10?
Economy 10 offers 10 hours of cheaper electricity, whilst Economy 7 offers seven hours cheaper.
These 10 hours are often split into three different periods throughout the day. For example:
- Low rates between 12pm - 3pm.
- Low rates between 5pm - 7pm.
- Low rates between 12am - 5am.
Economy 7 vs. Economy 10
Economy 10 tariffs are much less common than Economy 7 tariffs and many suppliers don’t actively promote Economy 10.
This means that you won’t be able to compare many Economy 10 tariffs to get the best deal. Also, comparison sites don’t usually have an option to compare Economy 10 as it’s so limited.
You get an extra three hours of cheaper electricity with Economy 10. However, these hours are split into separate intervals which makes it much harder to plan your electricity usage.
With Economy 7 you have seven consecutive hours to use energy at a cheaper rate. For many, this is much more practical. However, if you can organise your electricity usage with Economy 10, you could make more savings. It depends on your lifestyle and when you’re at home most.