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Economy 7

economy 7

This guide is intended to provide general guidance only. It is not intended to give you advice on your personal financial circumstances. You should seek independent professional advice if you’re unsure about anything mentioned in this guide or what choices to make

What is Economy 7?

Economy 7 is an energy plan, officially known as a ‘differential tariff’, that can help you pay less for your electricity. Basically, you pay normal prices during the day, but cheaper rates for seven hours during the night. The difference in cost may be up to 50%, depending on your electricity supplier.

So if you use appliances like dishwashers, slow cookers or washing machines overnight, it could help you cut down your energy bills.

It’s one of several different plans offered by energy companies – you can read all about them in our ‘energy tariffs explained’ blog.

Many people believe that electricity always automatically costs less during the night, but this is not the case. If you have a normal electricity meter, you can’t simply save money by using appliances at night. You need to sign up for Economy 7 and get a special meter installed.

Why is it called Economy 7?

Because there are seven hours each night when you can get cheaper electricity. There is also a plan called Economy 10 which – guess what – offers you ten hours of cheaper electricity. An Economy 10 plan can include off-peak hours during the afternoon, evening or very early morning as well as during the night.

In Scotland, energy companies provide white meters to monitor the lower overnight rate, so the plan is known as ‘White meters’ rather than Economy 7.

When does Economy 7 go on and off?

Economy 7 times differ depending on where you live and which energy supplier you’re with. For example, the seven off-peak hours might be 11pm to 6am, 12 midnight to 7am, 1am to 8am or even 1.30am until 8.30am. You would need to check with your supplier.

The hours usually change when the clocks go back or forward – so your Economy 7 times could be 1.30am to 8.30am during British Summer Time and 12.30am to 7.30am in the winter during Greenwich Mean Time.

Occasionally a company will divide the seven hours into two or more periods, so that your electricity cost would alternate between the two rates during the night. Once again, it’s important to check with your supplier exactly when their off-peak hours are, to make sure you don’t use appliances during peak times by mistake.

Would Economy 7 help me save money?

It depends how much of your electricity you can use at night rather than during the day. Because the daytime rate is higher than normal to balance out the off-peak rate, some people find Economy 7 actually works out more expensive. So do check carefully before you commit to switching.

It also depends what kind of heating and hot water system you have. With Economy 7, electric storage heaters and a hot water tank are the best combination, because you can charge them up during the night and use the heat and hot water in the daytime. Economy 7 can also work well if you use gas for your heating and hot water, but electricity for your appliances and lighting.

If possible, you should have your night storage heaters and hot water boiler wired on a separate circuit, which switches on when the night-time off-peak rate starts.

Here are some other considerations you need to think carefully about:

  1. Whether you can use more than half your electricity during the night – if not, you’ll probably end up paying over the odds because you’re using too much electricity during the day at the more expensive rate
  2. Whether your appliances have timers – because unless you regularly stay up until midnight or 1am, you’ll need to set a timer to switch them on at night when the Economy 7 off-peak hours start
  3. Your lifestyle – if you want to sit and relax in a warm home every evening, you may be disappointed, as your heating and hot water will be starting to cool down; if you’re a shiftworker, however, Economy 7 may be ideal for you

Am I already on Economy 7?

To find out if you’re already registered for Economy 7, have a look at your electricity or dual fuel bill. If your electricity seems to be charged at two different rates, one for day and one for night, you’re on Economy 7. So maybe you should try to do more washing, dishwashing or tumble drying at night, to see how much you could save.

You can also check by looking at your electricity meter – see the next question.

What is an Economy 7 meter?

If you’re already on Economy 7, you’ll have an Economy 7 meter with two sets of numbers – one ‘low’ and one ‘normal’ - or possibly ‘day’ and ‘night’,  which will be written beside or very close to the set of numbers.

Another kind of Economy 7 meter has a set of numbers shown as ‘day rate’ and a red button that you press to see your night-time figures.

If you’re still not sure, simply telephone your electricity or dual-fuel energy company and ask them.

Is there a similar Economy 7 rate for gas?

No. Because gas is mostly used for cooking, heating and hot water – not for appliances like washing machines and dishwashers that you can choose to use only at night.

Is it easy to switch?

It’s not completely straightforward because you’ll need to have a new meter installed, and you may have to pay for this service. Get in touch with your energy supplier to ask them how long it would take and what you’d have to pay.

I’ve already got Economy 7 but I’d like to switch back to a normal rate – what should I do?

Once again, get in touch with your energy supplier. You’ll probably need to have a new meter installed, and there may be a charge for this. They will also ask you some questions about your circumstances and energy costs, to make sure you meet their criteria for switching to a normal plan.

How else can I cut my energy costs?

If you don’t think Economy 7 would reduce your bills, here are some other cost-cutting suggestions.

A. Use less energy

The best way to use less energy and reduce your bills is to make sure your home and all your electrical appliances are working as efficiently as possible.

If you insulate your roof and walls, improve your heating system and generally  be quite careful, you can save around £300 a year. You’ll also cut your home’s carbon dioxide (CO2) emissions by around 1.5 tonnes – so you’re helping the planet, too.

Here are our top ten ways to become more energy efficient:

  1. When you boil a kettle, only use as much water as you need
  2. Turn appliances off at the wall – don’t leave them on standby
  3. Use energy-saving light bulbs
  4. Defrost your freezer regularly
  5. Fill that cavity! Cavity wall insulation can cut around £115 off your heating bill each year
  6. Get draught excluders for outside doors, windows and letterboxes
  7. Replace all your old windows with double glazing – it could save you around £135 each year
  8. If your boiler’s more than 15 years old, look into replacing it with a new A-rated condensing boiler
  9. Slip an insulating jacket on your hot water tank – you could save around £35 a year
  10. When using your washing machine, never set it higher than 30˚

B. Switch providers

No matter which energy company you’re currently with, it’s always worth checking the market regularly to see if you could save money by switching.

At OVO, we know that price matters – that’s why we keep our costs down, to help you save. You'll also get our 3% OVO interest reward on any credit in your account.

See how your current provider matches up next to our range of energy plans – you can compare energy prices for our electricity, gas and dual fuel plans. They’re based on a medium user, paying by Direct Debit, averaged across all UK regions. It’s the quick and easy way to compare utility prices.

Check our range of energy plans and see how much you could save now.

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1Monthly cost - Representative monthly direct debit costs based on a non-economy-7, dual-fuel, medium user (3100 kWhs elec. and 12500 kWhs gas) paying in advance by direct debit, including online discount.  All rates correct as of 23/08/16, but may go up or down.

2Weekly cost - Representative weekly costs based on a non-economy-7, dual-fuel, medium user (3100 kWhs elec. and 12500 kWhs gas).  All rates correct as of 23/08/16, but may go up or down.

3Pay Monthly Savings are based on the average estimated annual costs for new PAYM OVO customers quoted through the OVO website (based on household and/or consumption information provided by those customers), compared to their current supplier and tariff. Comparisons taken between 01/01/2016 and 11/10/16. Incl VAT. Actual savings may vary according to your current supplier or tariff, individual tariff options, household information, consumption and location.

4Pay As You Go Savings are based on the average estimated annual costs for new PAYG OVO customers quoted through the OVO website (based on household and/or consumption information provided by those customers), compared to their current supplier and tariff. Comparisons taken between 01/01/2016 and 11/10/16. Incl VAT. Actual savings may vary according to your current supplier or tariff, individual tariff options, household information, consumption and location. 

We include almost twice as much renewable electricity as the national average: At least 33% of electricity in all of our tariffs comes from renewable sources. The national average, according to Ofgem as at March 2014 was 16.7%. For more information please visit this page.

33% of your electricity comes from renewable sources: 33% renewable electricity as standard as of 1st April 2015. Renewable electricity is generated from wind, solar, geothermal, wave, tidal, hydro, biomass, landfill gas, sewage treatment plant gas and biogas.

3% interest: Calculated at 3% per year, paid monthly based on number of days in credit and the amount left in your account after you’ve paid your bill. OVO Interest Reward is capped at 12 times the amount of the current direct debit amount and is available to customers paying by advance direct debit. Terms apply:

95% of new customers save when switching to OVO: Based on all new customer signups between 01/02/2016 and 31/07/2016

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