Cheap rate electric tariffs explained

Shifting your electricity use to off-peak hours can significantly reduce your household energy bills. Cheap rate electric tariffs allow you to gain better control over your energy costs and make your home more energy-efficient by paying less for electricity during certain times. Fuse Energy offers modern dual-rate variable tariffs designed to help you take control of your energy usage and bills.

Discover how cheap rate electric tariffs can transform your energy bills. With Fuse Energy, you can access modern dual-rate variable tariffs designed to help you make the most of off-peak electricity. Click here to switch to Fuse Energy today.

What are cheap rate electricity tariffs?

Cheap rate electricity tariffs, also known as time-of-use (ToU) tariffs, charge different prices for electricity depending on the time of day it is used. These tariffs are designed to encourage consumers to use electricity during 'off-peak' hours when demand on the National Grid is lower, and energy is cheaper to generate. Conversely, 'peak' hours see higher rates due to increased demand.

Understanding time-of-use (ToU) tariffs

Time-of-use tariffs break the day into different pricing periods, most commonly peak and off-peak. The aim is to balance the grid by incentivising consumers to shift their energy-intensive activities to times when the overall demand for electricity is lower. This can lead to significant savings for households that can adapt their routines.

Peak vs off-peak: how rates differ

Electricity prices fluctuate throughout the day because the cost of generating and supplying power changes with demand. During peak times, typically in the late afternoon and early evening, demand is highest as people return home, cook dinner, and use appliances. This drives up wholesale prices, which suppliers then pass on to consumers through higher unit rates. Off-peak periods, typically overnight, see lower demand, making electricity cheaper. Dual-rate tariffs usually have a higher peak unit rate than standard single-rate tariffs, making strategic usage crucial for savings.

How dual-rate tariffs work in the UK

In the UK, dual-rate tariffs have evolved from legacy systems to modern, smart meter-enabled options. These tariffs offer distinct pricing for different times of the day, empowering households to make a power play with their energy consumption.

Economy 7 and beyond: legacy vs modern tariffs

Economy 7 is perhaps the most well-known legacy dual-rate tariff, offering seven hours of cheaper electricity, usually overnight. Historically, these tariffs relied on specific meters, such as those controlled by the Radio Teleswitch Service (RTS). Modern dual-rate variable tariffs, like those offered by Fuse, leverage smart meter technology or compatible multi-register meters to provide similar peak and off-peak pricing structures. Unlike some real-time dynamic tariffs, Fuse's dual-rate variable tariffs update their rates quarterly, providing a predictable yet flexible pricing structure.

The role of smart meters in accessing cheap rates

Smart meters are often beneficial for accessing and benefiting from modern dual-rate tariffs. They automatically record and send your electricity usage data to your supplier, distinguishing between peak and off-peak consumption. This eliminates the need for manual readings and ensures accurate billing based on your actual usage patterns. Without a smart meter, accessing the most competitive dual-rate tariffs can depend on your meter's Standard Settlement Configuration (SSC).

Typical off-peak electricity times

While specific off-peak hours can vary by supplier and tariff, they generally fall within these windows:

• Overnight: Typically during late evening and early morning hours.
• Mid-day: Some tariffs might offer a short off-peak window during the middle of the day when demand is typically lower.

It's crucial to check the exact timings for your specific tariff, as these dictate when you can benefit from cheaper rates.

Benefits of shifting to cheap rate electric

Switching to a cheap rate electricity tariff and actively managing your usage offers several compelling advantages beyond just saving money. It provides a sense of control and contributes to a more efficient energy system.

Reducing your household energy bills

The most direct benefit of cheap rate electricity is the potential for significant savings on your household energy bills. By shifting a significant portion of your electricity usage to off-peak times, households on dual-rate tariffs can often save a notable percentage on their overall electricity costs. The average UK home uses around 2,500 kWh of electricity per year1, so even small percentage savings can add up.

Gaining control over your energy costs

Dual-rate tariffs empower you to take an active role in managing your energy expenditure. By understanding when electricity is cheaper, you can strategically plan when to run high-energy appliances, charge electric vehicles (EVs), or heat water. This proactive approach gives you greater transparency and control over your monthly outgoings, turning energy management into an advantage rather than a chore.

Supporting a more efficient grid

When you use electricity during off-peak hours, you're not just saving money; you're also helping to balance the National Grid. Spreading electricity demand more evenly throughout the day reduces strain on the network during peak times, which can lead to a more stable and efficient energy supply for everyone. This contributes to a more sustainable energy ecosystem.

Finding the right cheap rate tariff for you

Choosing the right cheap rate electricity tariff requires a bit of homework to ensure it aligns with your lifestyle and home setup.

Assessing your energy usage habits

Before switching, take stock of your current electricity usage. Identify which appliances consume the most energy (e.g., washing machine, tumble dryer, dishwasher, EV charger) and consider how easily you can shift their usage to off-peak hours. If your lifestyle naturally accommodates overnight or late-evening usage, a dual-rate tariff could be highly beneficial. If not, the higher peak rates might negate any savings.

Comparing dual-rate variable tariffs

Research available dual-rate variable tariffs from different suppliers. Compare the peak and off-peak unit rates, as well as the daily standing charge. Remember that dual-rate tariffs typically have a higher peak unit rate than single-rate tariffs, so the savings depend on your ability to shift usage. Look for transparent pricing and clear information on how often rates might change. Fuse's dual-rate variable tariffs, for example, update quarterly.

Meter compatibility and upgrades

To access modern dual-rate tariffs, you'll typically need a smart meter or a compatible multi-register meter. If you have an older meter, such as a legacy Economy 7 meter or one connected to RTS, you may need an upgrade. Your current supplier is responsible for replacing outdated meters with smart meters, often at no direct cost to you. Ensure your meter is compatible before committing to a dual-rate tariff. You can learn more about smart meter installation and how it benefits your home.

Making the most of off-peak electricity

Once you're on a cheap rate electricity tariff, optimising your usage is key to maximising your savings and truly making a power play with your energy.

Optimising appliance usage

Schedule your high-energy appliances to run during off-peak hours. Many modern washing machines, dishwashers, and tumble dryers come with delay timers, allowing you to set them to start automatically overnight. Consider charging devices, running your immersion heater, or even using storage heaters during cheaper periods. Understanding your energy consumption can help you make informed decisions about understanding your energy bill.

Electric vehicle charging strategies

EV owners can significantly benefit from cheap overnight electricity. Charging an EV can be one of the largest electricity demands in a household. While Fuse's dedicated EV tariff was withdrawn from sale from 1 July 2026, customers can still benefit from cheaper overnight charging by using Fuse's general dual-rate variable tariffs. This allows you to power up your vehicle when rates are at their lowest, drastically reducing your running costs. For more tips, explore EV charging at home.

Smart home integration for automated savings

Smart home devices can take the effort out of optimising your energy usage. Smart plugs can automate when certain appliances turn on and off, while smart thermostats can manage heating schedules. Integrating these devices with your dual-rate tariff can ensure you're always using electricity at the cheapest times, without constant manual adjustments.

The future of cheap rate electric

The energy landscape is continually evolving, with significant changes impacting how households access and benefit from cheap rate electricity.

The RTS meter phase-out explained

RTS for legacy Economy 7 meters began its industry-wide phase-out on 30 June 2025. This means that meters relying on the RTS signal will eventually stop functioning, requiring affected customers to upgrade to smart meters to continue accessing dual-rate pricing. This phase-out is a significant step towards a smarter, more flexible energy grid.

Innovation in energy tariffs

The move towards smart meters and a more dynamic grid is paving the way for further innovation in energy tariffs. While Fuse's current dual-rate variable tariffs update quarterly, future developments could include even more granular time-of-use pricing, potentially linked to local grid conditions or renewable energy availability. These innovations aim to give consumers even greater control and opportunities for savings, moving towards a future where energy is less of a financial burden.

Managing your energy bills should be clear and easy to understand. Fuse Energy focuses on straightforward pricing, so you can see exactly what you're paying without unnecessary complexity. If you have a smart meter, you can view detailed usage data through the app or website, helping you understand how you can lower your bills. If you don you have a smart meter, Fuse Energy can upgrade your non-smart meter, completely for free. Our 24/7 human support team is always on hand with fast response times whenever you need help. Click here to switch to Fuse Energy today. Find out about our mission by clicking here.

References

1. Ofgem. Review of typical domestic consumption values