Choosing your energy tariff

If you have storage heaters or charge an electric vehicle overnight, a time of use tariff, sometimes called a multi-rate tariff, could work out cheaper.

It charges you different rates at different times of the day. These times are often split into:

• peak rate - sometimes called a day rate

• off-peak rate - sometimes called a night rate

Energy companies charge less for an off-peak or night rate because there is less demand for energy. They make it cheaper to encourage you to use energy when others aren’t. 

If you have storage heaters

You might find it helpful to be on a specific time of use tariff such as Economy 7 or Economy 10. The number refers to how many hours of energy you’ll get at the cheaper rate. 

If you’re on Economy 7 you’ll usually get 7 hours of the off-peak rate per 24 hours. You’ll usually get this in one continuous block overnight, for example, from 11pm until 6am.

If you’re on Economy 10 you’ll usually get 10 hours of the off-peak rate per 24 hours. This might be split up into chunks throughout the day, for example, your off-peak hours could be:

• 1pm until 4 pm

• 8pm until 10pm

• midnight until 5am

Carefully check the times for the off-peak rate, as they differ between suppliers.

If your storage heaters aren’t set up properly they can sometimes cost you more money. You can check if you're using your storage heaters efficiently.

If you charge an electric vehicle

If you need to charge an electric vehicle overnight, an electric vehicle tariff might work out cheaper for you - these are sometimes called EV tariffs.

You should check the details on the tariff carefully to find out the exact hours your electricity will be cheaper. Make sure you’ll get the off-peak rate when you want to charge your vehicle or it might work out more expensive.

If you have a prepayment meter or a smart-meter in prepayment mode, you’ll need to use a prepayment tariff.

On a prepayment tariff you’ll pay for your energy before you use it, sometimes called ‘pay as you go’ (PAYG). If you’re thinking about moving to prepayment you can check if prepayment will be right for you.

You can get different types of prepayment tariffs, for example:

• standard variable prepayment tariff

• fixed prepayment tariff

• ‘green’ prepayment tariff

If you don’t have a smart meter and want to switch suppliers, your new supplier might ask you to have a smart meter installed in prepayment mode, before they’ll let you switch.

You might find fixed prepayment tariffs are more expensive than other tariffs.

If you don’t owe money to your energy supplier, you could save money switching from prepayment to a credit tariff, where you pay for your energy after you use it. Check how to switch from prepayment to a credit meter.

You could consider a dual fuel tariff. To use this tariff you must use both gas and electricity.

A dual fuel tariff is when you get your gas and electricity from the same supplier - you’ll only get one bill.

You can get different types of dual fuel tariffs, for example:

• fixed rate dual fuel tariff

• standard variable dual fuel tariff

• green dual fuel tariff

You can sometimes get good deals on dual fuel tariffs because you’ll be getting both your gas and electricity from the same supplier. If you’re looking for a dual fuel tariff you can usually choose that option on price comparison websites.

On a dual fuel tariff you’ll have one point of contact for both your gas and electricity. This could make it easier to sort any problems with your supplier.

If you’re unhappy with your supplier it will mean you’ll need to switch both your gas and electricity.

You could consider a green tariff.

Generally green tariffs are more expensive as it costs more to supply renewable energy. 

You can get different type of green tariffs, for example:

• green standard variable tariff

• green fixed prepayment tariff

• green prepayment tariff

There isn’t a limit on what you can be charged on a green standard variable tariff. If your rate changes and it’s too high, you can leave your standard variable tariff at any time.

If you want a green tariff which uses 100% renewable energy, for example from wind or solar, you should check the wording of the contract carefully.

Some ‘green’ or ‘renewable’ tariffs might not contain any or all renewable energy. Instead, some suppliers say money from the tariff will be invested in renewable energy sources.

You can also get a separate tariff to sell your spare energy to a supplier. This is called a Smart Export Guarantee (SEG) tariff. 

SEG is a government backed scheme which pays you for your spare energy, it replaces the Feed-in Tariff (FiT). 

The tariff works in a similar way to an energy tariff, but you’ll be paid money instead of paying the supplier.

You’ll need to have a smart meter and you can choose between a standard variable or fixed tariff.

The renewable energy you sell to suppliers could come from:

• solar photovoltaic (PV) - these panels are often on roofs and they convert the sun’s energy into electricity

• wind - onshore wind generated from wind turbines

• hydro - power generated from rivers or streams

• anaerobic digestion (AD) - a biogas produced when organic waste breaks down

• micro combined heat and power (Micro-CHP) - a boiler which generates heat and electricity at the same time

To be eligible for the tariff your energy installation must have a capacity of less than:

• 5 megawatts for Solar PV, wind, hydro and AD

• 50 kilowatts for Micro-CHP

How much money you’ll get depends on your tariff and how much spare energy you sell to suppliers.

If you have an energy supplier, you can get a SEG tariff with a different supplier. You can find a list of energy suppliers who offer SEG tariffs on Ofgem's website.