Page last updated on 23rd August 2024
Energy flexibility: what is peak and off-peak energy?
You might have heard of energy-saving schemes that offer rewards for demand-side flexibility. Or, you might want to know more about time-of-use tariffs and whether you can save money by moving your energy use to off-peak times. This page will explain everything you need to know about flexible energy use. Including how getting a smart meter can help you to access new flexible tariffs and energy-saving schemes. Read on to learn more.
What is energy flexibility?
In Great Britain, our energy system constantly balances how much energy is produced (supply) with how much is needed (demand). Energy flexibility means adjusting this balance to keep everything running smoothly.
Moving energy use away from peak times is one way to help keep this balance. For example:
- You can do certain energy-intensive household chores (washing and drying clothes) on different days or at different times of day, when there is less demand for energy, or;
- You can use more energy at times when more renewable energy is being generated (like on very windy or sunny days). This kind of flexible energy use is sometimes referred to as demand-side flexibility.
To promote energy flexibility, some suppliers offer energy flexibility schemes or special tariffs that offer rewards for using energy at different times.
Customers will need a smart meter to get all the benefits from new flexible energy tariffs.
What are peak and off-peak electricity times?
Peak energy times are when there is most demand for energy. For example, one peak time might be evenings on weekdays, when many people are getting home from work, cooking dinner, or watching TV. Off-peak energy times will be when there is less demand for energy.
Typical peak times are between 4pm and 7pm Monday to Friday. Typical off-peak times include during the night and at weekends.
Some energy suppliers offer time-of-use tariffs and flexible energy schemes that offer cheaper energy or rewards for energy use at off-peak times. They might also offer rewards for using energy at times when a lot of energy is being generated. For example, on very windy days, when more energy is being generated from wind power.
If you have a time-of-use tariff or are taking part in a flexible energy scheme, the times when energy is cheaper, or rewards are offered, will vary depending on your supplier and the specific scheme or tariff you are using.
What is a flexible power system?
Energy system flexibility is the capacity of an energy system to balance changes in supply and demand. At one end of the scale, electricity system flexibility might involve using large-scale batteries to add energy to the grid when there is a lot of demand. At the other end of the scale, it might involve households changing when they use energy to reduce demand during peak energy hours.
One benefit of having a flexible energy system is avoiding energy being wasted. Such as situations where energy is generated but not used.
Energy flexibility could also help to make the most of when there is more energy from renewable sources. For example, on especially windy or sunny days. In Great Britain, smart meters are helping to build a flexible energy system. To learn more, see our page about how smart meters are helping to make Britain’s energy system smarter.
Electricity flexible pricing: is there a cheap time to use electricity?
If you are on a time-of-use tariff, electricity will be cheaper at certain times of day, or on certain days. If you are on a fixed or standard variable tariff, your energy will cost you the same each day, at any time of day.
If you’re on a time-of-use tariff, the cheapest time to use electricity will depend on the type of tariff you’re on. Examples of time-of-use tariffs include Economy 7, electric vehicle tariffs and tracker tariffs:
Electric vehicle (EV) tariffs
Electric vehicle (EV) tariffs are time-of-use tariffs that work in a similar way to Economy 7.
They are typically 2-rate tariffs, where it is cheaper to use energy at night. This means that electric vehicles can be charged more cheaply overnight.
Tracker tariffs
On tracker tariffs, energy rates are based on wholesale energy prices. The cost of energy on a given day will depend on wholesale energy prices on that day.
Economy 7 tariffs
Economy 7 tariffs have two set energy price rates: an on-peak rate and an off-peak rate. The cheaper off-peak rate will apply for 7 hours out of every 24 hours, usually at night.
Economy 7 tariffs aren't suitable for everyone. They work best for homes that only use electricity, or use a very large amount of electricity.
Economy 7 and Economy 10 tariffs are older types of time-of-use tariffs, which rely on having a specific type of electricity meter that works for those tariffs. Newer flexible time-of-use tariffs like EV and tracker tariffs need a smart meter to get all the benefits.
If you’re not sure what tariff you’re on, talk to your supplier to find out. If you’re not on a time-of-use tariff, but are interested in flexible energy pricing, you can research the tariffs that are available to you.
To access time-of-use tariffs, you would need an energy meter that works with the tariff. To access any new flexible time-of-use tariffs, you will need to have a smart meter that is set to send readings every half an hour. If you don’t already have one, your energy supplier should be able to install a smart meter for you at no extra cost.
Energy flexibility and energy saving schemes
Some energy suppliers offer energy reward schemes. These are energy saving schemes that reward customers for using energy flexibly. They may offer rewards for moving energy use or offer cheaper electricity on certain days or at certain times.
You will need a smart meter that is working in smart mode and sending half-hourly readings to take part in energy flexibility schemes. Get ready to take part in energy saving schemes by getting a smart meter, if you don’t have one already.
The National Grid ran the Demand Flexibility Service (DFS) scheme, which allows suppliers to reward customers for reducing their energy use at peak times.
Customers signed up for the DFS scheme through participating energy suppliers, aggregators and apps. The scheme was designed to help the nation’s electricity system manage energy demand during peak times. To take part, customers would need to have a smart meter that was operating in smart mode and set to send readings every half an hour. Contact your supplier about getting a smart meter so you’ll be ready for new energy-saving schemes when they are introduced.
Don’t know your supplier? For your gas supplier, visit Find My Supplier or call 0870 608 1524. For your electricity supplier visit uSwitch to find your local number to call.
What time is cheap electricity?
The cheapest time to use electricity will depend on the tariff you are on and if you've signed up to any energy flexibility schemes. If you're not signed up to any schemes and you are on a fixed or standard variable tariff, energy will cost you the same at any time of day.
If you’re on a time-of-use tariff, electricity will likely be cheaper at off-peak times, when there is less demand for electricity. This could be during the night. For example, electric vehicle tariffs typically offer cheaper rates for electricity at night.
There are also flexible energy tariffs that vary day-by-day, rather than hour-by-hour. On these tariffs, the price you pay for energy might depend on the wholesale cost of energy on a given day, rather than the time of day that the energy was used.
The price you pay for energy will only vary day-to-day or by time of day if you are on a time-of-use tariff, or if you are signed up to an energy flexibility scheme. You will need a smart meter in order to sign up to a new flexible time-of-use tariff and take part in energy flexibility schemes.
Your energy supplier cannot charge you based on the time of day unless you choose a time-of-use tariff. Time-of-use tariffs are not compulsory. Your supplier cannot switch your tariff without you knowing.
Not every household suits time-of-use tariffs and not everyone can use energy flexibly. Many people will always need to use electricity at certain times. For example, they can use it to cook and heat their homes in winter. There will always be periods of higher and lower demand.
Eligibility and availability vary. Consumer action required. Rewards schemes and tariffs available to selected customers from selected suppliers.
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