A simples guide

How much can I save with economy 7 and 10 tariffs?

You may have heard people saying they saved money on their energy bills on an economy 7 tariff or an economy 10 tariff, or you may have read about these deals in the media. But what are they, and are they right for you?

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What are the economy 7 and 10 tariffs?

An economy 7 tariff involves you paying a lower price for energy during a seven hour period in which you are likely to use the least energy. Energy providers may typically set the ‘off-peak’ period to run from midnight to 7am.

An economy 10 tariff works in a similar way, however here your off-peak periods may vary.
For example, five of the ten hours might be during the night, and there may also be a three hour and a two hour off peak period during the day.

Outside the periods covered by the tariff, you will be charged a higher rate for your energy usage.

Take careful note of exactly when your off-peak period begins and ends. Your energy provider may vary this by a few minutes each day, so on Mondays it might begin at midnight on the dot, and on Tuesdays it might start at 12.05am. Providers do this to stop all their economy 7 customers switching on appliances at the same time and overloading the grid. Also check if your off peak period changes when the clocks go forward and back – some providers use winter time (Greenwich Mean Time) all year round on economy tariffs.

If you sign up to one of these tariffs, you should expect your energy provider to give you a special meter. Make sure you send readings from this meter to the provider, and don’t always rely on their estimates of your energy usage. They have been known to be inaccurate and could lead to under- or over-charging.

Who might benefit the most from them?

Evidently, some of the people who might benefit most are the ‘night owls’, so if you don’t turn the light out at midnight on the dot each night, this arrangement could be for you? Do you often watch television, use your computer or read until the small hours? Do you sometimes host parties at your home that go on till late?

Even when you don’t stay up late, you can take advantage of the tariff by charging electrical appliances overnight or setting the washing machine to start during the off-peak period.

If you have a storage heater, then this type of deal could also be right for you, as the storage heater will heat up your water overnight and you then use the stored heat during the day.

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Why might you not be interested?

Just as some people can save money by using an economy 7 or 10 tariff, some people might end up paying more were they to switch to this.

Economy 7 and 10 tariffs may not suit people who would not be prepared to change their energy usage habits to benefit from the off-peak periods.

Money Saving Expert estimates that you should only sign up to an economy tariff if you use at least 30% of your electricity during the cheaper periods, so it’s worth taking a long look at your energy habits to make sure you don’t end up out of pocket.

Some people are on an economy tariff without being aware of it, so check your bill carefully and see if it includes different rates for different times of the day. If you’re on such a tariff and you don’t want to be, you need to look at switching to another arrangement.

Start comparting different tariffs today and see if you could save on an economy 7 or economy 10 tariff.