I do know what you’re pondering: what is that this ridiculous clickbait headline all about? Properly, a few weekends in the past, I charged my electrical automobile, cooked lunch in my oven, and washed my garments completely at no cost over a number of hours. Final weekend, my electrical energy value lower than 8p per kWh to do the identical factor. On common, I’m at the moment saving 40 p.c on my electrical energy payments in comparison with the extortionate capped charge that most individuals within the UK are compelled to pay proper now.
So, how? Octopus Vitality, and I would like everybody to learn about it.
I’ve obsessed over my electrical energy utilization over the previous few months due to a mixture of the UK’s power market costs and shopping for a brand new electrical car. A pal really useful Octopus Energy’s Agile contract, which gives variable pricing each half-hour primarily based on wholesale charges. He had been utilizing all of it winter with massive financial savings, as wholesale electrical energy costs have began to drop within the UK in latest months. In 2023, Octopus’ Agile costs have dropped far beneath the Vitality Worth Assure subsidy that the UK authorities launched to cap the utmost shopper costs for electrical energy after wholesale costs surged following Russia’s invasion of Ukraine.
Octopus Vitality points its 30-minute charges on daily basis at 4PM so you’ll be able to see when the most effective occasions are to make use of your dishwasher, washer, oven, or cost an electrical automobile. Peak charges between 4PM and 7PM are usually the same old charges of 34p and even 35p per kWh, however outdoors of these occasions, it has averaged at round 20p per kWh in latest months for me personally.
It can save you a bundle of cash in case you can shift your power utilization outdoors the height window. Even in case you can’t, you’re nonetheless going to save lots of as a result of, for round 20 hours of the day, the Agile charges are far beneath the usual ones.
A normal charge for electrical energy throughout UK suppliers proper now’s round 34p per kWh, with a each day service cost of as much as 50p. These charges and repair prices fluctuate barely per supplier, however the overwhelming majority of individuals within the UK are at the moment paying in extra of 30p / kWh. In July, the cap within the UK can be set at 30p per kWh, a charge that falls beneath the present Vitality Worth Assure and sees the Ofgem regulator return with its personal value caps.
However this value cap remains to be far past what I’m at the moment paying. Over the previous 28 days, I’ve used a median of 16kWh per day at a charge of 16.9p per kWh as an alternative of the 34p per kWh I’d have paid on an ordinary charge. That’s a saving of almost 50 p.c in comparison with what most individuals would pay for a similar quantity of electrical energy.
So why have I and lots of others not heard about this till not too long ago? Variable charge tariffs are dangerous. Octopus Energy markets Agile as a tariff that’s best for folks with EVs, storage heaters, or anybody who can shift their power utilization outdoors of peak occasions. But it surely additionally warns that costs can spike as much as 100p per kWh at any time, 3 times increased than the usual charges proper now. That sounds scary, nevertheless it’s one thing that hardly ever occurs. Actually, it hasn’t peaked previous greater than 40p per kWh in any respect in most locations within the UK in 2023.
That’s largely as a result of wholesale costs have been dropping, creating extra steady averages and moments of plunge pricing the place you get hours of free electrical energy. You possibly can see within the chart above that pricing has dropped to 0p per kWh or beneath a number of occasions over the previous six months on Octopus Vitality Agile.
Regardless of the reductions seen in latest months, you can too see a sustained spike for many of December, the place the utmost costs shot as much as 80p per kWh, a really costly charge that clients would have seen principally throughout the peak 4PM to 7PM window. If wholesale costs proceed to stabilize and drop, hopefully we gained’t see a repeat of this once more this winter. If costs do shoot up, you’ll be able to all the time simply instantly change again to the usual charge, which can be capped by Ofgem’s assure.
If costs soar, you’ll be able to all the time change again to an ordinary tariff
This volatility does make it laborious to advocate such an power tariff to everybody within the UK, which is one more reason most individuals gained’t have heard about Agile. Client advocate Martin Lewis, higher referred to as the “Money Saving Expert,” has been pushing the federal government frequently to assist with electrical energy costs, however he’s hardly ever really useful folks change to variable charge tariffs. Customers within the UK have been seeking to Lewis’ suggestions all through this power and price of residing disaster, however he did spotlight Octopus Vitality’s “intelligent” Agile tariff in April. Now that we’ve six months of steady information, I believe it’s time to start out recommending Agile till we’ve respectable fastened charges again available on the market.
In the event you’re savvy sufficient to trace the each day costs, then you definately’ll profit significantly right here. I’ve personally was an Octopus Vitality salesman with my family and friends, as the corporate even gives a referral program the place you break up £100 with a pal you advocate to the service. I exploit the superb Octopus Watch iOS app for alerts on when costs plunge and to see value charges over 24-hour intervals, however Octopus additionally publishes these in its personal cellular app and web site.
You will want the most recent SMETS2 sensible meter (some SMETS1 are supported), although, to have the ability to robotically ship meter readings to Octopus Vitality and use Agile. In the event you don’t have a wise meter, you’ll be able to nonetheless change over, and Octopus will prepare for a meter set up. Octopus has additionally began advertising and marketing its Tracker tariff not too long ago, which has similarities to Agile however has extra restrictions on how lengthy it takes to exit out if costs go the mistaken manner.
It’s additionally simply refreshing to make use of a utility firm that’s environmentally pleasant and has nice customer support. In an more and more inefficient and broken UK energy market, Octopus Vitality is manner out forward supplying inexperienced power with top-of-the-line software-as-a-service merchandise I’ve ever seen within the UK.
Ultimately, I hope to automate a lot of this with sensible dwelling tech and shops to restrict the time I’m monitoring charges. However figured I’d share this tip proper now in case it helps prevent some nice British kilos.