Is electricity cheaper at night?

In a bid to make those savings, many people also commonly ask the question is electricity cheaper at night?
The reality of it is a little more complicated. Yes, it can be cheaper – for both domestic and business energy customers.

But only if you’re on the right tariff, an off-peak tariff that offers electricity at a cheaper rate. It’s also crucial to regularly switch suppliers to find the best off-peak tariffs and avoid higher VAT rates and expensive contracts.

Electricity prices in the UK are influenced by various factors, including wholesale energy costs, transmission and distribution charges, and taxes.

Understanding these factors is crucial for businesses to manage their energy consumption and reduce their electricity bills.

With the rise of renewable energy generation and smart meters, businesses can now take advantage of off-peak electricity rates and cheaper night-time electricity to save money.

Off-Peak Electricity tariffs explained

So, what is an off-peak electricity tariff? And how does it provide cheaper electricity at night?

Well, first we need to define what peak time is. This is typically defined as the daytime – when energy consumption peaks because most businesses are open, leading to higher energy use.

Off-peak times aren’t quite so set in stone. In the UK, there’s no blanket period. Instead, the times for off-peak electricity tariffs are defined by individual suppliers. So, you may well find when comparing off-peak tariffs that both the prices and the finer details vary depending on the supplier.

Generally, the off-peak energy period falls anywhere between 10 pm and 8 am. This is the point during the day where the strain on the National Grid eases, and some (but certainly all) energy suppliers will offer cheaper electricity at night. Utilizing off-peak tariffs can significantly reduce electricity costs for both residential and business consumers.

Some suppliers will title them differently, but the tariffs offering these cheaper rates will most likely be either; Economy 7 or Economy 10. Maximizing savings with off-peak tariffs also involves improving energy efficiency, which can be achieved by using smart meters to monitor and manage energy consumption effectively.

Business Electricity Rates and Tariffs

Business electricity rates and tariffs vary depending on the energy supplier, usage, and location. Businesses can choose from a range of tariffs, including fixed tariffs, variable tariffs, and time-of-use tariffs.

Fixed tariffs offer a set price per unit of electricity for a fixed period, while variable tariffs are subject to changes in wholesale energy costs.

Time-of-use tariffs, on the other hand, charge different prices for electricity used during peak and off-peak hours. Businesses can also opt for green tariffs, which are sourced from renewable energy generation.

There are several types of electricity tariffs available for businesses, including:

Businesses can compare these tariffs to find the best deal for their energy needs and budget.

It’s a multi-rate plan for your electricity supply. You might also hear it referred to as a peak / off-peak tariff.
It’s available to business and domestic customers. You’ll essentially pay two rates for your electricity: a regular day rate, and a cheaper rate for seven overnight hours (hence the 7). Using high energy appliances, such as ovens and dishwashers, during these off-peak hours can lead to significant energy savings.

So, for example, if you own a bar or nightclub that predominantly operates during late-night / early-morning hours, you could potentially save money on your business electricity with an Economy 7 tariff. This is because you’ll be consuming most of your electricity during those cheaper rate hours. Electric vehicle owners can also benefit by charging their vehicles at night, taking advantage of the lower off-peak rates to reduce their costs.

However, the standard day rate or peak time will be more expensive than a standard rate. This means if you operate for a period during the day, before reopening late at night, your business probably wouldn’t benefit from being on Economy 7.

What are Economy 7 times?

It’ll differ from supplier to supplier, so it’s worth checking. For most, the off-peak period runs from 12 am (midnight) through to 7 am. When moving to new business premises, it is crucial to check the off-peak hours to ensure you are not automatically transitioned to more expensive deemed rates.

Half hourly meters play a significant role in monitoring electricity usage during off-peak hours. These meters record and transmit electricity usage to suppliers every 30 minutes, which is essential for larger businesses with high energy demands.

How to read an Economy 7 Meter

To sign-up for an Economy 7 tariff, you’ll need to have a special meter – specifically designed to provide two sets of electricity usage readings.

Accurate meter readings are crucial for billing, as they ensure you are charged correctly based on your actual energy consumption.

An Economy 10 tariff follows the same principle as Economy 7, but rather than providing you with seven hours of off-peak rates, it provides 10 hours of off-peak rates. There’s a big difference: these off-peak periods are split across day and night.

Variations in business electricity prices can depend on the specific tariffs chosen, with different options available to suit the energy needs of both small and large businesses.

These tariffs provide a wealth of flexibility. However, it’s worth noting that Economy 10 tariffs aren’t as common as they once were – not many suppliers offer them today. Comparing business electricity tariffs is crucial for businesses to secure the best deals and manage energy costs effectively.

How to read an Economy 10 Meter

Reading your Economy 10 meter is exactly the same as reading an Economy 7 meter – so, you’ll find all the useful information you need in the ‘How to Read an Economy 7 Meter’ section of this page.

The ongoing energy crisis has significantly impacted energy prices, making it crucial for businesses to understand their energy consumption and costs.

Monitoring your Economy 10 meter readings is essential for managing your energy costs effectively. Keeping an eye on energy prices can help you make informed decisions about fixed-term contracts and tariffs, which offer stability and protect your business from the volatility and fluctuations in energy prices.

So, is electricity cheaper at night if you have an E7 or E10 tariff? Yes, it is. If you run a business that primarily operates late at night or early in the morning, you could potentially save a lot of money on the amount you pay by switching to one.

Additionally, households can benefit from time-of-use tariffs by scheduling energy-intensive tasks, such as charging electric vehicles, at night to maximize savings on their electricity bills.

However, there is a caveat, and it’s a pretty big one – to get the most benefit, and the cheapest deal, your business would need to be one that consumes most of its energy during those off-peak hours. Commercial electricity rates can vary significantly based on different tariffs, so securing a fixed-rate contract can protect your business from rising energy costs.

So, if your business was, for example, a bar, nightclub, takeaway, distribution centre etc., you may well be able to benefit. Tailored electricity tariffs are particularly important for small businesses, as they can compare rates and negotiate better prices while navigating specific regulations and benefits related to business electricity supply.

If you use energy during these hours, as well as some during the day, you could stand to save more by comparing standard deals to help you reduce business energy costs. This is because the amount you’d be paying for those regular daytime hours would be more expensive on an Economy 7 or 10 tariff.