Choosing the Right Electrical Tariff

With so many different tariffs on offer from the energy companies today, it’s not easy to understand exactly how much you will pay for your electricity and electric heating.

Our own research has found that over 60% of the population could be paying up to 30% too much for their electricity, even though the market has now been regulated for over 10 years to provide a fairer deal for consumers.

Regional electricity suppliers

It may surprise you to learn that using your regional electricity supplier could mean that your electricity bills will be higher than if you used a supplier from a different region.

This situation came about as a result of legislation passed over 10 years ago, preventing regional suppliers from competing on price in their own region. Regional suppliers can only compete on price in other regions of the country, in order to create a competitive environment for the energy market.

Best market tariff rates

Three years ago, we measured our home at 8p per kWh over a full year. Energy prices later rose to 9.2p per kWh, but very quickly dropped to 7.3p around May 2010. During 2011 rates climbed to 9.5p and even touched 10p, however during February 2012 we have seen it drop back to hover around 10.5p to 11.5p

At Economy Radiators, we receive many calls from people who are finding it difficult to make sense of their electricity tariffs. So we’d like to help by explaining the facts behind some of the myths:

But first which of the following do you think is the best of these three tariffs?

  Economy 7 or 10 Standing Order No Standing order
  Option 1 Option 2 Option 3
Standing charge £11.25 per month £11.15 per month NONE
Off peak
(0 to 7am)
5p kwh    
On peak 12p kwh    
Rate 1   n/a 15p kwh first 900kw
Rate 2   8p kwh 8p kwh
  • The answer is Option 3. Why? This tariff actually provides 900 KWh for free. Also, we have found that using Economy 7 or 10 is NEVER a good idea (see why below)
  • Be wary of ‘no standing charge’ claims (i.e.: the charge for having a meter and electricity in your home). If the energy provider does not levy a standing charge, it’s likely that cost will instead be converted into units. In our example above, Rate 1 = 15p kWh Rate 2 = 8p kwh after 900 kW. This equates to 900 units over a year charged at 15p. Or to put it another way: a standing charge of £11.25 per month would be exactly the same cost to you. With this example, you will pay the same amount, but the standing charge has been ‘disguised’. However, you would effectively get 900 free units over the year compared to the other three tariffs
  • The important point to note is that Rate 2 has a rate of around 8p per kWh. This is the target you will need to match or beat with an alternative rate
  • Many suppliers will give a better rate online than over the phone, so use comparison websites such as, or But do be careful to always look behind the figures
Energy Comparison Tool

Economy 7 or 10 (off peak / on peak)

In Scotland this type of tariff may be known as ‘total heat total control’.

Be very wary of claims that these tariffs will save you money. Our research has found that customers on these tariffs will pay the same as, or sometimes even more than, customers on alternative tariffs.

This is because the on-peak price is inflated to cancel out the off-peak discount. The average of the on and off peak cost is designed to be, at best, the same as a normal tariff and, in some cases, could be much worse.