When is the cheapest time to use electricity in the UK?

With the price of electricity staying high for the foreseeable future, it’s worth looking at how you can shift your usage to cheaper times of the day.

The only way to access off-peak periods at the moment is to get a time of use tariff – there aren’t many of them now, but they’re growing in number.

In this guide, we’ll explain when electricity is usually cheaper and more expensive, why these price swings happen, and which suppliers offer time of use tariffs.

Of course, the best way to save money on your electricity bills is by going solar at no upfront cost.

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Does electricity change price during the day?

Electricity is produced by wholesale generators like gas plants and wind farms, who sell it to suppliers – like Octopus, British Gas, and EDF – at a nationally standardised price. These suppliers then sell the electricity to households.

The price of electricity for suppliers changes throughout the day, as usage rises and falls.

During periods when the UK uses the least electricity, suppliers can buy electricity for lower prices.

But when demand for electricity rises sharply across the nation in the morning and evening, the price that wholesale generators charge climbs with it.

Energy companies usually look at predicted wholesale electricity prices over the next few months, then create a flat rate that will allow them to make a profit – or just set their rate at the highest level allowed by Ofgem’s energy price cap.

Households can only take advantage of the way electricity prices change by signing up to a time of use tariff, which comes with off-peak and peak pricing.

These tariffs allow customers to profit from shifting their electricity to periods of lower demand, and benefit suppliers who can buy more of their electricity when it’s less expensive.

Octopus offers advanced time of use tariffs that shift every half-hour based on the latest wholesale price, or are built around renewable products like heat pumps, electric vehicles, and solar panels. We’ll go into more detail below.

What time is off-peak electricity in the UK?

The UK typically uses the least electricity between 12am and 6am, according to a Leeds University study, and energy suppliers usually put off-peak periods in or around these times.

You’ll find some tariffs that start their off-peak period as early as 10pm, or carry on until 8am – but these are rare.

Peak electricity periods usually run from around 5pm to 8pm, which reflects the fact that demand is generally highest from 5pm to 10pm.

This is the way suppliers have traditionally set peak and off-peak periods: in static time of use tariffs with set rates during specific hours that don’t change for the length of your contract.

So if you agree to pay 17p per kWh (kilowatt-hour) during the 12-4am off-peak period, 34p per kWh for peak electricity from 7pm to 9pm, and 23p per kWh the rest of the time, that’s exactly what’ll happen every day.

The other, newer option is to choose a dynamic time of use tariff like Agile Octopus, which changes price every 30 minutes and uses your smart meter to calculate how much electricity you’ve used in different half-hour periods.

Every afternoon, you’ll be told about the next day’s prices, so you can plan and adjust your energy consumption accordingly. After a week or two, you should get into a rhythm of avoiding the most expensive periods – enabling you to save hundreds of pounds per year.

Why is electricity cheaper at night?

Electricity is typically cheaper at night because demand is lower across the country.

The majority of people turn off their lights, devices like TVs and games consoles, and appliances like washing machines and dishwashers, then go to sleep.

Most commercial and industrial work also ceases, which causes another massive reduction in electricity consumption.

When demand falls for a good or service, the price drops too – and electricity is no different.

Even though suppliers buy electricity from generators in advance, the fact that electricity demand is lower at night is factored into the price they pay.

For households though, electricity is only cheaper at night if you’re signed up to a time of use tariff that includes a nightly off-peak period.

How can you take advantage of off-peak times?

You can take advantage of off-peak times by shifting your electricity consumption to those periods.

That’s not always easy – after all, off-periods happen at night because that’s when people are least likely to be at home, awake, and using lots of electricity.

Thankfully, there are plenty of ways to move your electricity usage later without sacrificing sleep.

Firstly, many appliances like washing machines, tumble dryers, and dishwashers now come with a timer, meaning you can delay them from starting until the off-peak period begins.

Some products even come with an app that means you can set a start time from anywhere in the world.

You can plug other devices, like your TV, games console, and lamps, into smart power strips. These handy pieces of tech connect to your phone, allowing you to set times each night when all your connected products switch off.

Households with smart light bulbs can similarly use an app to choose a time when they all turn off.

If you heat your home electrically, for instance with a heat pump, you can programme the system to operate at a lower level at night, which may make sense if you’re tucked up in bed.

And electric car owners can set their vehicle to charge exclusively during off-peak periods, massively cutting their driving costs in the process.

How much money can you save by doing this?

You can save hundreds of pounds by shifting your usage away from peak periods if you have a heat pump or electric vehicle.

If not, most households can still save up to £100 per year by simply using their largest appliances at off-peak times.

How much you’ll ultimately save will depend on your total electricity consumption, how much of your usage you move to off-peak periods, and the rates included in whatever tariff you choose.

Which energy suppliers offer time of use tariffs?

Here are the UK electricity suppliers that currently offer time of use tariffs:

• Octopus
• 100Green
• British Gas
• OVO
• Ecotricity
• Good Energy
• E.ON
• EDF
• Scottish Power

Some of these suppliers provide off-peak electricity to all customers, while others only offer time of use rates to households with additional appliances such as a heat pump, electric car, storage heaters, or electric boiler.

Every domestic electricity supplier – including those not on the list above – offers an Economy 7 tariff, which gives you seven hours of off-peak electricity every day, but they’re mainly targeted at electrically heated homes.

Suppliers frequently change the off-peak tariffs they offer, so make sure to call a few companies before you commit.

Who is eligible for a time of use tariff?

Almost all households are eligible for a time of use tariff, as long as you’re connected to the electricity grid and have a smart meter.

Your smart meter will need to be able to communicate with its national network, but most homes are close enough to the network that it’s not an issue.

To sign up for an Economy 7 tariff, a smart meter will also do, or an Economy 7 meter.

Some suppliers also require you to pay by direct debit to qualify.

How do you sign up for a time of use tariff?

Signing up for a time of use tariff is virtually the same as getting any other type of tariff, as long as you fulfil the eligibility criteria.

If you switch providers, your new supplier may want to check your smart meter’s connection before the tariff begins.

Otherwise, it’s just a matter of agreeing to the new tariff’s terms and conditions, entering your payment details, and passing the standard credit check. Your new supplier will handle the rest.

All in all, it should be a smooth process that requires minimal involvement from you and takes three weeks at most.

Are there any alternatives to a time of use tariff?

There are plenty of alternatives to the static, traditional time of use tariff that includes a single, daily off-peak period with a fixed rate.

You could choose a tariff like Agile Octopus that’s constantly dynamic, meaning its electricity rate changes every half-hour, according to wholesale prices.

Each day, you’ll be informed what the electricity rates will be tomorrow, so you can plan your usage to save the most money.

Most other alternatives require customers to own a piece of renewable technology – like solar panels, a heat pump, or an electric car – which make having one of these products even more financially attractive.

This allows suppliers to appeal to the growing number of households that are going green.

Some companies now provide solar panel owners with tariffs that involve peak and off-peak periods for both importing electricity and selling your solar electricity to the grid.

Intelligent Octopus Flux links the two rates, meaning that you’ll always pay the same amount for your grid electricity as Octopus pays you for the electricity you export.

So during the 4-7pm peak period, you’ll pay more if you use grid electricity, and receive more per kWh for any electricity you export. The rest of the time, you’ll pay and be paid less.

Signing up this tariff also involves handing control of your battery over to Octopus, which allows the company to maximise your profits and help smooth out grid consumption peaks.

Octopus Flux includes three rates – an off-peak, peak, and day rate – which are different depending on whether you’re importing or exporting.

There are now lots of time of use tariffs that target electric vehicle owners, but they generally offer the same, static approach – apart from Intelligent Octopus Go.

This tariff sets itself apart by guaranteeing that it’ll charge your car at a lower rate, whatever the time of day. All you have to do is tell the Octopus app how much charge you want and when you need it by, and it’ll charge you at the off-peak rate.

Some tariffs also provide multiple off-peak phases, like Cosy Octopus, which offers heat pump owners three periods per day when they can heat your home for less.

Will flexible tariffs become the default for everyone?

Flexible tariffs seem likely to become the default option for households.

Ofgem is considering how to adapt the energy price cap as the UK electrifies its heating and transport networks, resulting in higher electricity usage at different times of the day.

Instead of a fixed cap on electricity, the national regulator may switch to a cap that changes prices depending on the time of day.

As well as giving customers the chance to save money by shifting their usage, this would benefit the grid by reducing consumption peaks and limiting the amount of storage needed to supply the country with increasing amounts of electricity.

Flexible tariffs could theoretically benefit everyone, but realistically, some households would find it difficult to avoid using a lot of electricity at peak periods.

For example, you probably can’t delay watching TV with your children until after their bedtime – and if you urgently need clean clothes for the next day, you may have to physically move them to the tumble dryer before you can go to bed.

Faced with a flexible price cap, these homes may therefore choose to sign up for a fixed tariff that doesn’t penalise them for using electricity during peak periods.

Summary

Time of use tariffs will inevitably become more common as more households buy electric vehicles and heat pumps, and the grid has to work harder to balance its output.

This pricing revolution will encourage people to shift their electricity usage, buy renewable technology, and generally speed up the country’s move to net-zero emissions.

Considering 62% of all electricity meters are now smart and just 26% of households have a time of use tariff, the market for flexible tariffs is ripe for expansion.

If you’re wondering how much you could save with a solar & battery system, enter a few details below and we’ll generate a quick estimate.

FAQs

How can I save money in peak hours?

You can save money in peak hours by not using appliances like your oven, dishwasher, and washing machine, not charging your devices, and switching off as many lights as possible.

Appliances generally have timers or apps that you can use to ensure they only turn on when the peak period’s over.

And though it can be difficult to shift an event like dinner out of peak hours, you could potentially cook a meal beforehand, then heat it up in the microwave, which uses significantly less electricity.

What uses the most electricity when not in use?

When it comes to household items that consume the most electricity when you’re not using them, games consoles are often the main offender.

If you leave your console on standby and it’s programmed to auto-update, it’ll switch on and download updates as soon as they go live.

If you turn off the auto-update feature, it’ll only update when you’re already using the console, massively reducing the amount of electricity you use.