Economy 7

markr180

I have just received an email from my energy supplier....Energy costs are reducing but because how you use your energy (E7) your bill will increase, are they trying to make E7 obsolete or what..My E7 Tariff rate is now nearly 100% more costly than it was 2 yrs ago. I Thought it payed to use off peak electric as it was basically wasted. Looks like the only alternative is to turn to fossil fuel for my heating and don't say get a air source heat pump, 2 adjacent homes have just had them removed and reverted to oil.

TheElectricCow

Welcome to 2023, where most people's energy rates are at least 100% more costly than 2 years ago - I believe the official statistics are closer to 150% though. Not really an E7 specific problem, that's just what the typical cost of energy currently is.

If your rates are going down but your bill is going up that is entirely down to your own usage/usage patterns. The best alternatives are to either shift more usage into the off-peak period (if practical), switch energy supplier to one offering more suitable E7 rates for your usage patterns, or switch to a non E7 tariff if more appropriate.

Robin9

markr180 said:

I have just received an email from my energy supplier....Energy costs are reducing but because how you use your energy (E7) your bill will increase, are they trying to make E7 obsolete or what. .My E7 Tariff rate is now nearly 100% more costly than it was 2 yrs ago. I Thought it paid to use off peak electric as it was basically wasted. Looks like the only alternative is to turn to fossil fuel for my heating and don't say get a air source heat pump, 2 adjacent homes have just had them removed and reverted to oil.

Were you  on a good fix 2 years ago but now on a SVT ?

Jonboy_1984

Even before the current “crisis” the gap between the peak and off-peak rate had been closing for several years on the standard tariff of the provider I was with. 

I think the energy companies see the ofgem cap as an average target rather than a limit…

QrizB

Welcome to the forum.

markr180 said:

I have just received an email from my energy supplier....Energy costs are reducing but because how you use your energy (E7) your bill will increase, are they trying to make E7 obsolete or what.

Economy 7 tariffs vary from supplier to supplier. If your property is heated by storage heaters, E7 is likely to remain the most cost effective means of heating.

My E7 Tariff rate is now nearly 100% more costly than it was 2 yrs ago.

Everybody's electricity is double the price it was in 2021. It's not just you.

I Thought it payed to use off peak electric as it was basically wasted.

That has never been the case, not even back in the days of coal being the UK's main source of electricity.

Looks like the only alternative is to turn to fossil fuel for my heating and don't say get a air source heat pump

If you have a heat pump, E7 is unlikely to be a good choice of tariff. Single rate electricity (or one of the smart tariffs) will usually work out cheaper.

2 adjacent homes have just had them removed and reverted to oil.

Spending serious money on an oil boiler plus tank will then leave you exposed to the vagaries of the heating oil market.

This past winter, despite the high electricity price, a heat pump with a COP of 3 would have been roughly the same price to run as an oil boiler.

dunstonh

I have just received an email from my energy supplier....Energy costs are reducing but because how you use your energy (E7) your bill will increase, are they trying to make E7 obsolete or what..My E7 

E7 is anything but obsolete.   Indeed, there has never been such a range of multi-rate tariffs available.

My E7 Tariff rate is now nearly 100% more costly than it was 2 yrs ago.

Yet my E7 costs are lower than they were in 2021. (on the back of the off peak being half what it was back then, although peak rate is much more)

I Thought it payed to use off peak electric as it was basically wasted. 

It does if you are on multi-rate tariffs.   However, you need a sufficient ratio of off peak vs peak for it to work.  Depending on your supplier, that target ratio will vary.    For example, I am close to 70% off peak and EDF at 8p per kW is cheaper than any single rate.   However, if my use was 30% off peak, EDFs cheap rate would be more expensive.   Some suppliers have pricing that targets lower ratios.  Some suppliers have pricing that targets higher ratios.

E7 pricing is like a see saw.   The lower the off peak rate, the higher the peak rate.   

Give us your ratio (or annual unit count for peak and off peak) and we should be able to tell you if E7 is suitable for you (or whether switching is a good idea).  Also tell us your region.   

JSHarris

Some suppliers have been taking advantage of the OFGEM price cap detail when setting E7 rates.  We are on E7 (no alternative as we can't have a smart meter here) and our supplier last year increased the off-peak rate by over 300% in one go.  They reduced the peak rate by about 20% at the same time.  I challenged them and they openly admitted they were allowed to do this as the OFGEM cap mechanism assumes an average for peak/off-peak SVR E7 tariffs.  As long as the average was within the cap they were compliant.

I switched suppliers (not easy when none of the price comparison sites were working) and in the process found that of all the suppliers only OVO and EDF were offering relatively low E7 tariffs.  OVO were very slightly cheaper than EDF, but their response to my request to switch to them was both very slow and riddled with problems with their website switching process (like not accepting my phone number as being valid - never did find out why).

EDF are so-so.  Their billing system is dire, but as I record all our consumption through Home Assistant and have an integration that shows the bill to a granularity of 6mins that doesn't really bother me.  I opted for the fixed DD option having heard others report that EDFs 6 month billing cycle was a PITA.  We're in credit with them, but not by enough to bother me particularly.

CSI_Yorkshire

JSHarris said:

Some All suppliers have been taking advantage of applying the OFGEM price cap detail when setting E7 rates.

FTFY.

There's nothing that says suppliers must, or even should, have any particular differential between the peak and off-peak rates.

What you actually mean is that for your particular pattern of usage you would like the tariffs to do something, and they didn't.  That's not the same thing.

JSHarris

CSI_Yorkshire said:

JSHarris said:

Some All suppliers have been taking advantage of applying the OFGEM price cap detail when setting E7 rates.

FTFY.

There's nothing that says suppliers must, or even should, have any particular differential between the peak and off-peak rates.

What you actually mean is that for your particular pattern of usage you would like the tariffs to do something, and they didn't.  That's not the same thing.

Not quite, but I take your point.  For decades the price split between E7 peak and off-peak rates has been broadly similar across many suppliers.  For decades I've got used to that being the status quo.  Last year that changed big time for some reason.  Off-peak tariffs were clearly being gamed by some suppliers as a way to try and keep peak rates lower and still fall within the much more vigorously applied price cap.

I've been an E7 customer on and off since the late 1970s and I've not seen this behaviour in the past.  Also, looking at the ratio of off-peak to peak wholesale costs nothing much changed.  Wholesale electricity was still much cheaper overnight than during the day.

You're right, in decades past suppliers could have done this.  However, in the main most chose not to.  There was a general policy of E7 off-peak rates being around 1/3rd to 1/2 peak rates.  That changed very dramatically with some suppliers last year.  Admittedly our supplier last year was one of the more extreme, in that they put their off-peak prices up by over 300%, whilst reducing their peak prices.  Bit of a blow for those that rely on E7 for all their heating and hot water.  I'm not sure this was morally defensible behaviour , even if the OFGEM rules allowed it.

Dolor

I'm not sure this was morally defensible behaviour , even if the OFGEM rules allowed it.

Business decisions are never fair on everybody. If you don’t like what is on offer then the answer lies in our own hands:  ditch and switch.

JSHarris

Dolor said:

I'm not sure this was morally defensible behaviour , even if the OFGEM rules allowed it.

Business decisions are never fair on everybody. If you don’t like what is on offer then the answer lies in our own hands:  ditch and switch.

I agree, but the last year or so has made switching a great deal harder than it used to be.  I couldn't find a single price comparison site working when I was looking.  Trying to find out tariffs was a heck of a lot harder than it should have been.  Even using the "get a quote" feature from many suppliers either wasn't working or wouldn't provide tariff information.

I stuck at it for the best part of a day, but had the luxury of free time to do this, being retired.  Even then finding tariff information was a lot harder than it should have been.  Only one supplier made finding this information easy (Octopus), all the others hid it or only made it available on request.  Not fun having the ring around a dozen suppliers (with the inevitable call centre frustration) just to find out what their tariffs were and whether they were taking on new customers (many weren't at the time).