Are EV and ToU tariffs unfair to other electricity customers?

JKenH

I have started this thread to respond to a comment on a different thread ( Martin Lewis: Standing charges update risks households paying more) without taking that thread off topic

QrizB said:

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This isn't entirely true if you look beyond standing charges (the subject of this thread) and include unit costs (which the thread has begun to include).

Someone on a flat rate tariff will be paying a weighed average price covering the entire period of the tariff (3 months for the SVT, 12 or more for a fix). Swapping to a ToU tariff will allow the householder to choose to use more electricity during cheaper periods and less during more expensive ones. This can save the householder money without creating a loss for the supplier that needs recovering from elsewhere. A "winner" without a corresponding "loser".

That is an interesting (and valid) point. 

Ultimately if every individual optimised their consumption to achieve the lowest import price on a ToU tariff then prices would adjust to meet demand until they levelled out. So at the moment those able to take advantage of ToU prices can do so because others can’t. 

That is the short answer and applies to tariffs such as EV tariffs which are underpinned by the variable utility of electricity - we value it more at tea time than in the middle of the night. 

The situation is more complicated with tariffs like Octopus Agile and Tracker and Intelligent Octopus which have arisen to reflect price variability driven by the intermittency of renewable generation and I concede there can be winners here without corresponding losers. In fact it can be win-win on occasions if curtailment is avoided as SVT customers also benefit. 

Edit 29 July: this thread has developed in ways I hadn’t expected including discussion about what constitutes fairness and why these tariffs exist which inevitably involves discussing policy. I believe these apparently tangential issues are in fact fundamental to discussing these tariffs and I would request Admin allow this discussion to develop freely as it might sitting round a bar room table. 

MarzipanCrumble

What is a ToU tarriff?  

Please don't assume readers know!

It is Time of Use Tarriff.  Fine for me - retired.  Not so much for working families.

TadleyBaggie

Time Of Use

powerful_Rogue

Are EV and ToU tariffs unfair to other electricity customers?

No.

Ildhund

MarzipanCrumble said:

What is a ToU tarriff?  
Please don't assume readers know!

A timely question indeed. Does Economy 7 (and its cousins E8, E9, E10 ...) fall into the accepted orbit of Time of Use tariffs? It was very probably the first one, after all ...

debitcardmayhem

 No, what isn’t fair is curtailment and stand by payments.

Scot_39

Providing they only reflect the half hourly wholesale rate variations typical for those times of day - NO.

They are simply tge modern day evolution of older E7 and E9/E10 style tariffs.  Which charged less at traditional off peaks.

And arguably tariffs like Cosy and its 51% above day rate peak 4-7 benefits peak demand - in tge same way my E10s 4-8pm peak rate slots encourages me to use any heavy load items in the 1-4 and 8-10pm gmt slots either side.

And so if anthing might reduce the demand so not only tge peak price but average daily prices in tge future supply rather than live tracker type market the UK cap is based on.

JKenH

Scot_39 said:

Providing they only reflect the half hourly wholesale rate variations typical for those times of day - NO.

They are simply tge modern day evolution of older E7 and E9/E10 style tariffs.  Which charged less at traditional off peaks.

And arguably tariffs like Cosy and its 51% above day rate peak 4-7 benefits peak demand - in tge same way my E10s 4-8pm peak rate slots encourages me to use any heavy load items in the 1-4 and 8-10pm gmt slots either side.

And so if anthing might reduce the demand so not only tge peak price but average daily prices in tge future supply rather than live tracker type market the UK cap is based on.

But Octopus Go EV tariff daytime rate at 27.48p is only marginally above SVT  (25.73p) and paired with 5 hours at 8.5p is very attractive, if like me you heat your water by electricity, but is only available to those who own an EV. There is no peak teatime (4-7) rate so it doesn’t shift usage away from that high demand slot. There is no link to the wholesale price. 

The 8.5p rate is also considerably cheaper than Octopus Agile overnight rates. I asked Chat GPT what these were and this was the answer.

📉 2024 Average (for the full calendar year)

• The 2024 average night rate, defined as 23:00–06:00, was about 13.6 p/kWh  .
• Since the 1–5 am window falls within that night period, you can use this rate as a strong estimate for those hours across the year.

⚡ Year‑to‑Date 2025 (so far in 2025)

• For 2025 through mid‑year, the average night rate (23:00–06:00) has been around 17.7 p/kWh  .
• Again, this covers the 1–5 am window, though seasonal variations mean it’s slightly higher than last year.

badmemory

I am not really sure why you think they may be unfair.  I am on one & I make sure that my heating never comes on at the high rate which means someone coming in from work has the electricity to cook their tea.  It is just a way for the companies to spread the load which is better for all of us.

Spoonie_Turtle

JKenH said:

Scot_39 said:

Providing they only reflect the half hourly wholesale rate variations typical for those times of day - NO.

They are simply tge modern day evolution of older E7 and E9/E10 style tariffs.  Which charged less at traditional off peaks.

And arguably tariffs like Cosy and its 51% above day rate peak 4-7 benefits peak demand - in tge same way my E10s 4-8pm peak rate slots encourages me to use any heavy load items in the 1-4 and 8-10pm gmt slots either side.

And so if anthing might reduce the demand so not only tge peak price but average daily prices in tge future supply rather than live tracker type market the UK cap is based on.

…

The 8.5p rate is also considerably cheaper than Octopus Agile overnight rates. I asked Chat GPT what these were and this was the answer.
…

Don't do that, it's not reliable.  Its purpose is to give a response that sounds natural, not an accurate answer, because it's a large language model not a search engine.

On the topic of your question, I don't really understand why you'd think they're unfair beyond possibly the fact that not everyone can make use of one.  But that's true of virtually everything in life, and we don't tend to say it's unfair that part of the population can make use of a certain discount or offer and others can't just due to their lifestyle or preferences.  (It's only unfairly discriminatory if it inherently and only excludes people on the basis of a protected characteristic.)

Newbie_John

I think they are very fair, if someone is using something where it's more expensive they should pay more, not rely on others to pay for them.

Look at holidays, what's fairer, £300/night in July and £50/night in November or £290/night all year round? 

There are days when there is too much electricity and it's simply being wasted by lack of demand, there are days when it needs to be purchased at very high price from abroad - so I'd say it's unfair by others to us, to environment to do whatever they want whenever they want - it's fine if they pay premium.