Economy 7 is an energy tariff. It is designed to help consumers pay less for their electricity by encouraging its use at night. This is achieved by offering two different rates based on the time of the day. Economy 7 tariffs go hand in hand with a range of specifically designed appliances, such as electric storage heaters.
What exactly is Economy 7?
As one would expect, the heaviest demand for electricity is during the day from breakfast until dinner time. By encouraging the use of power during the night, Economy 7 tariffs reduce the peak-time demand on the national grid.
Economy 7 tariffs are widely used in properties which are not connected to the gas main. They are also used in properties where it would be difficult or impossible to install an oil tank, such as flats. Instead of wet central heating, such properties typically contain electric storage heaters. Unlike radiators, these aren’t linked together, and can be operated independently from each other. As the name suggests, they heat up ceramic bricks or clay during the night, which is then emitted throughout the day.
Heat is then emitted throughout the day, warming the home without drawing on the more expensive day rate electricity.
Economy 7 tariffs can also be utilised by specifically designed hot water cylinders. These are known as direct hot water cylinders. In a direct cylinder there is no heat exchanger – the water is heated directly by two immersion heaters. One of them is situated near the bottom, and another just beneath the crown of the cylinder. During the night, the bottom heater heats the overall body of water on the cheaper night rate. During the day, the top heater functions as a “boost” heater, operating intermittently to keep the water at the desired temperature, and heating the cylinder when the hot water is replaced with fresh cold.
When does Economy 7 go on and off?
The cheaper night rate is generally available for around seven hours, hence the name. It may be active from midnight until 0700, from 2300 to 0600, or from 0030 to 0730, for example. The exact time span, however, depends on the energy provider.
Economy 7 tariffs are only available for electricity, not gas or oil. They also require the installation of a special meter. Switching to an Economy 7 tariff or switching back to a standard tariff will require exchanging the meter. You will have to contact your energy supplier to facilitate this, and there may be a charge for it. Note that simply using electricity during the night on a non-Economy 7 tariff will not result in cheaper bills.
Economy 7 problems and tips
One of the main criticisms of this tariff is that the day rate is overpriced. While this is done to encourage night time use, it increases the chances of consumers paying too much for electricity overall. If you don’t heat your home with electric storage heaters and you tend not to use any electric appliances at night, Economy 7 is the wrong tariff for you and you will definitely end up paying too much. On the other hand, if electricity is your only heat source, Economy 7 is likely to be the best option. If you work anti-social hours and tend to use a lot of energy during the night, you may save even more money.
A disadvantage of this tariff is that since energy is stored in advance, you will have to plan ahead with your energy usage. For example, when a cold snap is coming up, you will want to make sure your heaters charge up enough during the night, otherwise they will run out towards the end of the day, and you won’t be able to have a cosy warm living room on a winter’s evening without drawing on expensive day rate electricity.
An obvious way to take advantage of the cheaper night rate with other appliances in the home is to use timer plugs. These can be digitally or manually operated. Simply set the timer, plug in, and your appliance will come on at the preset time. However, you should be aware of any considerations when it comes to leaving electric appliances unattended, and you shouldn’t leave tumble dryers unattended at all.