Pricing plan info

Identifying the best plan

All electricity companies have a range of different pricing plans. (We've detailed the main types in Plan types explained.)

To identify which plan is best for you, you have to consider how much power you use, when you use it, and whether you are prepared to make changes in the way you use power.

We outline the options below, but be aware that not all companies offer all plans and that there may be some costs associated with changing to a cheaper plan. For example:

• Some retailers charge a fee to existing customers who want to switch to another plan with their company.
• Some retailers insist that if you want to switch to them as a new customer, you must first go on to a plan equivalent to your existing plan, and then (after you've switched) pay the appropriate fee to switch to any new plan you want.
• Switching to a new plan may require a new meter or modifications to your existing meter. You will be charged for this.

For details of what your supplier offers, and the likely savings and costs involved in switching, speak to your electricity company.

There are 3 main ways you can change how you use power, outlined below.

Reduce your peak electricity demand

The price your company pays for its power is higher at peak times (morning and early evening) than at other times. If you can switch some of your power consumption to off-peak times, your company will often supply you with that power at a cheaper rate.

The easiest way to switch some of your power consumption to off-peak rates involves wiring up your hot-water cylinder and night-store heaters in special ways. Your hot-water cylinder heats and stores the hot water you use. Night-store heaters use power at night to store up heat which they then release through the day.

The companies pass on to consumers the benefits of using off-peak power in two main ways:

Controlled power

This is where your hot-water cylinder and some other appliances (usually night-store heaters) are wired up so that the company can turn them off at peak times. This is known as 'ripple control'. The company will often guarantee to supply power to your hot-water cylinder for a minimum number of hours a day (the fewer the hours, the cheaper the rate). Ripple control does not affect the power you use for cooking, lighting and plug-in appliances.

Most consumers will already be on some form of controlled power, but one way you can save money is by switching more of your appliances to the controlled rate.

Another method is to decrease the amount of time for which you receive controlled power (for example, if you only receive power to your controlled appliances for 10 hours a day rather than 15, you could pay a cheaper rate because the company is guaranteeing to supply power for a shorter period).

However, if you have a large number of people in your household and/or a smaller, older, or poorly insulated hot-water cylinder, look at an option that gives you at least 19 hours of power a day. If you have controlled power for less time than this, you might suffer the occasional unexpected cold shower!

If you are looking at an option that gives you less power, you may want to consider purchasing an insulating wrap for your hot water cylinder to reduce the heat loss.

Time-of-use rates

The most common of these is a Day/Night rate, where the night rate (which usually runs from around 11 pm to 7 am) is cheaper than the day rate.

If you have a large, modern hot-water cylinder or a storage heater, look at the Day/Night options. With the Day/Night rate you can also choose to do certain activities, such as the washing, at night when the power is cheaper.

You don't necessarily have to pick only one of these options. You may find a plan that gives you both a Day/Night rate for your general power usage and a controlled power rate for your hot-water cylinder. But look at the prices for the different options carefully before choosing – for example, the day rate on the Day/Night rate can be relatively expensive.

Pre-paid power

With these plans you pay no daily fee at all. You just pay for what you use. This can be great for someone who is not home often. But there is a catch; you have to pay in advance – either by loading up a smart card or by getting a PIN number that charges up a meter.

Some companies can install a power management system in your home to help you control your power use. These systems may have different rates for different times of the day. So, before using an appliance, you can check what it will cost and, if you like, put off using it until power is cheaper.

Change your daily fee

On almost all plans there is a daily fee which you pay regardless of how much electricity you use. Some companies have plans that allow you to choose a higher daily fee with cheaper power. All companies must offer low-user plans that give a lower daily fee but more expensive power.

If you use less than 8000 kWh per year, you'll be better off moving to a low-user plan and paying more for the power you actually use. If you use a lot of power, go for a higher daily fee with a cheaper rate for the power you use.