Energy News

‘Happy hour’ tariffs will mean cheaper energy

Monday, 2 November 2009

By Hazel Cottrell - hazel@consumerchoices.co.uk

‘Happy hour’ tariffs - offering cheaper energy at off-peak times - will allow customers to save money on their energy bills, according to Npower.

If smart meters are rolled out across the country, energy providers will have the opportunity to offer new, more flexible discounted tariffs.

Smart meters, which monitor and transmit households’ energy use to suppliers, will allow energy companies to introduce more intelligent “time-of-day tariffs”.

These tariffs would encourage Brits to use energy at less popular times, and thus smooth out energy consumption levels in the UK throughout the day.

Npower has been trialling new “time-of-day” tariffs in the Midlands and they have proved popular.

Nicholas McHugh, spokesperson at Npower (www.npower.com), said that as a result: “We will probably see the demise of Economy 7 and Economy 10 tariffs.”

Unlike Economy 7 and Economy 10 tariffs, which offer set periods of discounted energy, the new tariffs are likely to have more flexible discounted periods, possibly in the form of “happy hours”.

McHugh suggested a “traffic light” system may even be introduced, where the current cost of energy would be displayed as red, amber or green on smart meters.

Chris Eagle, commercial manager at Energychoices.co.uk, said: “Smart meters are good news for the consumer. Several studies have shown that people are more likely to reduce their energy consumption if they can see it clearly.”

He added: “Customers are always attracted by discounted energy and the traffic light system could give them a new level of control over their usage.”

The government wants smart meters to be in all UK homes by 2020, but detailed plans for the wide-scale roll-out have, so far, not been released.