Many people don’t know they have it. Others don’t understand it. Some just presume it is saving them money. Economy 7 is the electricity tariff that offers customers 7 hours of energy through the night at a much cheaper rate.
Yet many people who have the system are not taking advantage of it. Others that could benefit from the tariff are sceptical and don’t have it. Economy 7 can be a genuine saver, in the right situation. Otherwise, it can be Un-economical 7.
How Economy 7 works
The Economy 7 tariff puts consumers are two separate price rates for energy. One price for a period of 7 hours, usually sometime between 2300 and 0800, is a cheap rate. During the night there is less of a demand for power so electricity suppliers can afford to do this. Then there is a day rate for all power used outside those seven hours. This price is a lot higher and actually more expensive than tariffs that offer one set price.
Who uses Economy 7?
Those that use most of their electricity in the seven hour period can save hundreds of pounds compared to a set-price tariff. This almost certainly includes people that use electricity to heat their homes and water. Electric storage heaters use the cheap energy during the night to warm up and release the heat throughout the next day. This will account for most of your electricity usage so if you have electric central heating but not Economy 7 – act now!
It is common perception that those with electric central heating are the only people that can have Economy 7. This is simply not true. Anyone can sign up for the tariff and can reap the financial rewards. Some people even have it without realising. To find out, check your meter or bill. If there is two separate rates chances are you are on Economy 7. If in doubt ring the supplier.
Getting the best from Economy 7
Getting the best from Economy 7 means using most of your electricity at night. It is estimated that to gain the benefits of the tariff you need to use between 20% – 40% of your electricity during the allotted hours. Obviously, with electric central heating this is easy. Though there are people that are suited to the tariff that do not use electric storage heaters.
People that work strange hours so use most electricity during the night are well suited. It is also possible to set appliances to work on a timer so they work through the night. Simply put, the more electricity you can use at night instead of the day, the more than can be saved. It is important to remember that ‘through the night’ can include up to 7 or 8 in the morning on some tariffs, so this can be a lot more feasible than you think.
For some, though, Economy 7 is just not the right tariff. This includes some people that are currently on it. The day rate on Economy 7 is nearly double the night rate so can be very costly. In fact, if you are signed up to the tariff but are using more in the day it could be losing you hundreds of pounds. All the benefit of the cheap night rate can be quickly cancelled out by the expensive day rate. To find if it is working for you, assess your usage. Look closely at your bills and when you are using the bulk of your units. If the answer is in the day you may want to change tariffs.
Making Economy 7 work for you
If you think Economy 7 could work for you it is easy to try. Contact your supplier about moving to Economy 7. If it is not working it is also easy to move back. Economy 7 is often treated with doubt and unease. The truth is, there is no secret to Economy 7. The trick is working out if you can live a lifestyle to make the most it the system. If you can, it could save a fortune.
Written by Michael Hallam
