Until installing solar our energy tariff was a simple single unit rate tariff. The cost of electricity per kWh unit was the same all day, whether we were using it during the day or in the night.
What is a smart tariff?
Smart tariffs are time of use tariffs. Different periods of the day are charged at different rates. The lower cost periods usually coincides with periods when less people are using less energy or times we may have more renewable energy generation.
The original smart tariff was the Economy 7 tariff, where you had a special meter installed to give you 7 hours of lower cost energy at night. With the roll out of smart meters being able to meter half hourly periods opens up the ability to price electricity at different rates.
Types of Smart Tariffs
There are two different types of smart tariffs:
Fixed time of use: Where there are two or more different unit rates at fixed times each day.
Dynamic time of use: where there are different unit rates throughout each day. The rates will often vary hour to hour but can also vary day to day too.
Why Smart Tariffs?
The idea of smart tariffs to change behaviour of energy users to manage their energy use in line with electricity availability and demand. It can make our electricity grid greener because we can use more energy when more renewable energy is being generated (ie windy days), but also reducing peak demand by using less when we would utilise expensive fossil fuel generation to meet high demand periods. Effectively you're paying less for energy when there is more greener renewable energy available or lower demands, but paying more when more expensive fossil fuelled energy generation is being used to meet higher demand.
Smart tariffs aren't necessarily perfect for everyone. Some either won't have the ability to 'load shift' some of their energy use or have the technology installed to shift their energy use. For those who can be flexible with their energy use smart tariffs can both save you money and make our electricity grid greener.
Smart tariffs available from octopus energy
Octopus Energy provide many smart tariffs to their customers. These are generally geared specifically towards Electric Vehicle, Solar & Battery and Heat Pump users, but there are some available that don't necessarily need these technologies and just an ability for the energy user to 'load shift' their energy use.
I will discuss some of the Octopus smart tariffs I've considered as a solar, battery and EV user:
Electric Vehicle Tariffs
* Octopus GO
* Intelligent Octopus
SOLAR TARIFFS
* Octopus Flux (import & export tariff)
* Octopus Outgoing Fixed or Agile (export tariffs)
* Octopus SEG (export tariff)
Other electricity Tariffs
* Octopus Agile (import tariff)
* Octopus Tracker (import tariff)
Octopus GO
Octopus Go has a fixed 4 hour low cost energy period designed for charging an electric vehicle during the lower demand overnight period. The idea is by charging the electric vehicle overnight during this fixed period will reduce the overall demand during daytime peak demand periods. In return you are charged a rate of 9.5p per kWh instead of the daytime rate of 30.72p per kWh. This reduces the kWh unit rate to 70% of the daytime rate and allows an electric vehicle to cost around 3p per mile.
If you have solar until recently you were limited to the standard Octopus SEG tariff of 4.1p per kWh exported when using the Octopus Go tariff. Octopus have recently create the Octopus Outgoing Lite SEG tariff where you are paid 8p per kWh exported which closes the gap between the low cost import rate and the export rate.
Intelligent Octopus
Intelligent Octopus is similar in a way to Octopus Go in that it provides a fixed 6 hour low cost energy period for home use during the lower demand overnight period, but it differs as it controls the charging schedule. This means it can be used to load balance the national grid and ensure energy at the most efficient times.
Intelligent Octopus requires either a compatible electric vehicle or a compatible EV charger. This is because you state the amount of recharge required and the time its required by and Octopus will determine a suitable charging schedule to do that. The determined charge schedule may not coincide with the fixed 6 hour low cost energy period. Any electricity used outside the fixed 6 hour window will still be charged at the 7.5p per kWh rate. This means your electric vehicle is recharged at a reduced kWh unit rate of 75% of the daytime rate and allows an electric vehicle to cost around 2.5p per mile.
If you have solar you're now eligible for the Octopus Outgoing SEG tariff of 15p per kWh exported by using an Octopus Electric Vehicle tariff. This combination is likely to the best option for EV and Solar owners as you get both low cost EV charging and an excellent SEG export rate for your excess solar. It's also unusual in that the export rate is higher than the import rate. This efficiently means its more cost effective to export all solar generation than to use solar diverters to transfer excess generation to an EV.
Octopus Flux
Octopus Flux is a solar/battery import and export tariff. There are three kWh unit rate periods, flux, daytime and peak. The general idea of Octopus Flux is that you charge your home batteries during the low cost flux period and export your excess solar energy in the day time or higher peak evening period.
You can recharge an EV during the low cost flux period, although at a higher rate to a specific EV tariff.
This means your electric vehicle is recharged at a reduced kWh unit rate of 40% of the daytime rate and allows an electric vehicle to cost around 6p per mile.
Unlike the EV tariffs you will able to get a much higher SEG export per kWh price for your exported excess solar energy. As an EV user if you have lots of excess exported solar energy Octopus Flux could potentially work out better for for you by offsetting the higher EV per mile cost with higher export income.
Octopus Agile
Octopus Agile was one of the first time of use electricity tariffs created to encourage avoiding energy use during peak periods. The Agile tariff is explained in depth on 'Octopus Agile Pricing Explained'.
The basics of the Agile tariff is that half hourly unit rate prices change throughout the day reflecting the dynamic pricing of electricity. Agile unit rates can drop very low, even to negative prices where you're paid to use energy. That said the opposite can also happen with unit rate prices being able to hit 100p per kWh.
The graph below shows the Agile unit rate prices for a week in August 2023. As you can see the unit rates vary over a day, but also vary day to day too. In this case you'd try to use electricity outside of the 4pm to 7pm peak periods, but also try to utilise the day where prices drop very low.
Graph source: www. energy-stats.uk
Octopus Tracker
The Octopus Tracker tariff follows the daily wholesale price of energy. Rather than a time of use tariff where prices change every half hour, the unit rate covers a whole day. Just like Agile unit rates prices are able to hit a maximum of 100p per kWh.
Graph source: www. energy-stats.uk
Export Tariffs
Octopus provide a variety of export tariffs from fixed tariffs through time of day tariffs to variable agile tariffs.
Which export tariff you can use is dependant on your import tariff. If you're on an Octopus EV tariff the only export tariff you're eligible for is the standard 4.1p fixed SEG export tariff. Octopus Outgoing fixed tariff provides a higher fixed 15p per kWh. Octopus Flux provides the highest SEG export unit rate of 32p per kWh during the peak period between 1600 to 1900 each day.
Graph source: www. energy-stats.uk
What smart tariff do we use?
Initially, even with solar installed we weren't on a smart tariff as we used the standard flexible tariff and Octopus Outgoing tariff for our exported solar generation. It wasn't until the release of the Octopus Flux solar/battery tariff that we considered a smart tariff. I have to say it was initially the higher SEG export unit rates that piqued, our interest in Octopus Flux. The variable time of use import unit rates meant prior to installing a home battery we tried to 'load shift' some of our higher energy use appliances such as the dishwasher and washing machine to the overnight lower flux rate period.
Since installing a home battery we've not needed to load shift as our home battery stores solar energy to use later. As our electricity needs are met by our stored solar energy means we hardly use any daytime or peak rate electricity. We do have to manage the number of appliances running at one time to ensure the power is meet by the available solar and battery power, rather than importing mains electricity.
The lower rate Flux period has allowed us to charge our EV during this time each night. Even though its only a 3 hour period we can charge sufficiently to meet our needs if we charge most nights, and top up with excess solar energy during some days.
Whilst the higher low cost period unit rate is higher than EV tariffs like Octopus Go and Intelligent Octopus the higher SEG export unit rates can off set the higher low cost period rates.
What about winter?
Winter is notoriously bad for solar generation. Solar generation can drop to a third of the summer peak generation. This means we will be exporting less excess solar energy which during summer offsets the higher low cost period rate of Octopus flux. This means in winter we may need to change to an EV tariff and standard SEG export tariff. Come spring we would likely change back to Octopus Flux.
The Octopus Flux tariff needs a high amount of excess solar exported to be viable for us. If we were to utilise more of our solar generation through self use it could make being on an EV tariff full time a better option for us. For us this would likely need us to install further home battery storage capacity to capture the excess solar during the day and transfer it to the EV in the evening, before topping up further in the low cost period. Due to the type of home battery storage and inverter we have we would be limited to a fixed period EV tariff like Octopus Go as we have to have the home battery 'charging' for the scheduled EV recharge not to drain the home battery. This means that sadly Intelligent Octopus is not possible for us, unless we can rewire the EV charger outside of the households.
Stop the Press - Intelligent Octopus changes everything
Until now it was always a case that EV tariffs weren't eligible for Octopus Outgoing fixed or agile export SEG rates. A change on 5th September 2023 means Intelligent Octopus can now be used with Octopus Outgoing. This is huge for anyone with both solar and an EV. This change means it's now the most suitable tariff combination we us as EV and solar users. It will mean will could stay on one tariff year round without needing to worth about swapping and changing tariffs throughout the year as the solar seasons change. Hopefully the Myenergi Zappi EV Charger will soon be compatible with Intelligent Octopus... fingers crossed.