Understanding Time-of-Use Tariffs

Time-of-use (ToU) tariffs are energy pricing structures that charge different rates depending on when you use electricity. Rather than paying a flat rate throughout the day, you’ll pay less during off-peak hours and more during peak times. For UK households, off-peak periods typically fall between 8pm and 8am, with some variation depending on your supplier.

These tariffs have become increasingly popular as the energy market shifts towards renewable generation and grid balancing. Ofgem-regulated suppliers now offer several ToU options, making them an accessible way to reduce your energy bills. If you’re running a heat pump, these tariffs become particularly valuable, as heat pumps are controllable appliances that can shift their operating times.

Why Heat Pumps Work Well with Time-of-Use Tariffs

Heat pumps are ideal for time-of-use tariffs because they heat your home slowly and steadily, rather than the rapid on-off cycles of traditional boilers. This means your heating system can operate during cheaper off-peak hours and still maintain comfortable temperatures throughout peak periods.

Modern heat pumps, particularly air source heat pumps, can store thermal energy in your home’s fabric. By running your heat pump during off-peak hours, you warm your property when electricity is cheapest, then coast through peak times using that stored heat. This thermal storage effect is the key to maximising savings.

Air source heat pumps typically cost between £8,000 and £13,000 to install, with running costs significantly lower than conventional heating. Combined with a ToU tariff, they become even more economical. Ground source heat pumps are more expensive upfront but offer similar benefits.

Setting Up Your Heat Pump for Off-Peak Operation

First, check your heat pump’s capabilities. Most modern units have programmable controls allowing you to set different heating schedules for different times of day. Your installer should have provided guidance on accessing these settings.

• Smart thermostats: Invest in a compatible smart thermostat like Nest or Hive, which integrates with many heat pump systems. These allow remote control and scheduling via smartphone apps.
• Thermal storage: Set your heat pump to reach maximum comfortable temperature during off-peak hours. A well-insulated home will maintain this warmth into peak periods.
• Boost settings: Use your heat pump’s boost function sparingly during peak hours only when absolutely necessary.
• Underfloor heating: If your heat pump powers underfloor heating, this system stores heat exceptionally well and responds perfectly to off-peak scheduling.

Document your heat pump’s model number and specifications. This information helps when comparing ToU tariffs and understanding your system’s capabilities.

Choosing the Right Time-of-Use Tariff

Not all ToU tariffs suit heat pump users equally. Compare options carefully, looking at both standing charges and unit rates.

Popular UK suppliers offering ToU tariffs include Octopus Energy (with their Agile and Go tariffs), E.ON, EDF Energy, and British Gas. Octopus’s Go tariff, for example, offers five hours of significantly cheaper electricity daily, perfect for heat pump operation. Their Agile tariff varies hourly, rewarding those who can shift usage flexibly.

Calculate potential savings by auditing your current usage. If your heat pump runs roughly eight to ten hours daily, an off-peak tariff could reduce heating costs by 30-50%, depending on the specific tariff structure.

Remember that Ofgem price caps don’t prevent variation between suppliers; rather, they cap unit rates for standard variable tariffs. ToU tariffs sit outside this cap, meaning you might pay more or less depending on your consumption patterns.

Practical Tips for Maximising Savings

Start by understanding your tariff’s off-peak window. Most UK suppliers define off-peak as 8pm to 8am, but some have different windows. Align your heat pump schedule precisely with these times.

Reduce peak-hour demand by shifting other electricity use where possible. Run dishwashers, washing machines, and electric showers during off-peak hours. This maximises your ToU tariff benefits beyond just heating.

Monitor your consumption using your smart meter. Most ToU tariff customers receive smart meters automatically, displaying real-time usage and costs. Review this data weekly initially to spot patterns and adjust your heat pump settings accordingly.

During particularly cold weather, pre-heat your home more aggressively during off-peak hours. Your home’s thermal mass will carry this warmth through peak times. Conversely, during milder months, scale back off-peak heating and use peak-time boosts only when necessary.

Maintain your heat pump properly. Annual servicing ensures optimal efficiency, which directly impacts how effectively stored thermal energy keeps your home warm.

Checking Compatibility and Getting Started

Before switching to a ToU tariff, contact your current supplier to confirm your heat pump compatibility. Not all systems work with all tariffs, and some require smart meter installation first.

If switching suppliers, check that your chosen provider supports your heat pump model. Your installer’s documentation will list compatible systems. Many newer installations come pre-configured for ToU tariff operation.

Request a free switching service from comparison sites like Moneysupermarket or Comparethemarket, which help identify suitable ToU tariffs for heat pump owners. These platforms increasingly filter specifically for heat pump compatibility.

Once switched, allow at least one full billing cycle to assess actual savings. Your consumption patterns may shift as you adjust your heat pump schedule, and actual benefits depend on your home’s insulation quality and size.

Key Takeaway

Time-of-use tariffs represent a significant opportunity for heat pump owners to reduce energy bills. By scheduling your system to operate primarily during off-peak hours, you can achieve savings of hundreds of pounds annually while maintaining full home comfort.

Start by reviewing your heat pump’s programmable features, compare available ToU tariffs from Ofgem-regulated suppliers, and consider upgrading to a smart thermostat for convenient scheduling. Monitor your consumption patterns closely and adjust your settings based on actual data.

The combination of heat pump technology and intelligent tariff selection is transforming household energy economics across the UK. Don’t miss this opportunity to reduce your bills significantly.

Ready to switch? Use our energy comparison tool today to find the best time-of-use tariff for your heat pump and start saving money tomorrow.