Can a time-of-use tariff save me money?

A time-of-use tariff could lower your electricity bills if you can shift some of your electricity use to periods when rates are cheaper.

The biggest savings opportunities are often linked to high-consumption appliances and technologies, such as electric vehicles (EV), heat pumps, hot water systems and home batteries.

At a glance

• You could reduce your electricity bills by using more electricity during cheaper periods.
• Electric vehicles, heat pumps and home batteries can offer significant opportunities to save.
• A time-of-use tariff isn’t right for every household.
• Understanding when and how you use electricity is key to deciding whether you’ll benefit.

Who is most likely to save money with time-of-use tariffs?

Electric vehicle owners

Charging an electric vehicle overnight can cost less than charging during peak periods, particularly if your tariff offers lower overnight rates.

Homes with heat pumps

Heat pumps use electricity throughout the day. If you can adjust your heating schedule to take advantage of cheaper periods, you may be able to reduce running costs.

Homes with hot water cylinders

If your hot water system allows you to heat water during cheaper periods and use it later, you could reduce the cost of heating your water.

Homes with battery storage

Home batteries can be charged when electricity is cheaper and used later when rates are higher, helping you avoid more expensive periods.

Flexible households

You may be more likely to benefit if you can change when you use certain appliances, particularly those that consume a lot of electricity.

Five ways to maximise your savings with time-of-us tariffs

1. Charge your electric vehicle overnight

If your tariff offers cheaper overnight electricity, scheduling your EV to charge during these hours can be one of the simplest ways to reduce charging costs.

2. Use appliance timers and delay-start functions

Washing machines, tumble dryers and dishwashers often have timers or delay-start settings. Use them to schedule energy-intensive appliances for cheaper periods.

3. Heat water when rates are lower

If your hot water system allows it, schedule water heating for periods when electricity costs less.

4. Make the most of battery storage

Charge your home battery when electricity is cheaper, then use the stored energy during more expensive periods.

5. Learn your tariff’s cheapest hours

Time-of-use tariffs vary. Check exactly when peak, off-peak and any other rates apply so you can plan your electricity use accordingly.

Common mistakes that can reduce your savings

Switching to a time-of-use tariff won’t necessarily save you money on its own. You could see little or no benefit if your electricity use doesn’t match the tariff’s cheaper periods.

Watch out for:

• Using most of your electricity during peak periods.
• Not knowing when cheaper rates apply.
• Choosing a tariff without comparing its peak rate.
• Focusing only on the off-peak price and overlooking standing charges.

Questions to ask before switching

Before choosing a tariff, ask your supplier:

• What are the peak and off-peak rates?
• What is the standing charge?
• When does each rate apply?
• Based on my current electricity use, is this tariff likely to save me money?

How to get started

1. Check your smart meter

Most time-of-use tariffs require a smart meter that can send readings correctly. Check that yours is suitable before switching.

2. Review your electricity use

Look at when you use the most electricity and identify activities that could be moved to cheaper periods.

3. Compare tariffs

Compare peak and off-peak rates, standing charges, contract terms and exit fees before deciding which tariff is right for you.

Need advice?

Energywise’s friendly advisors can provide impartial information about time-of-use tariffs and help you understand whether one could work for your home.

Call us free on 0808 196 8268 or fill out our contact form.