The best electricity tariff for battery storage
Homeowners in the UK can now power their home for as little as 7 p/kWh and cut electricity costs by more than 60%. The combination of home battery storage and off-peak electricity tariffs designed for electric vehicle (EV) owners makes this possible.
EV owners have been charging their cars on cheaper overnight tariffs for years, instead of paying the more expensive rates during the day. You can charge your home battery on that same off-peak rate for as little as 7 p/kWh and use the electricity during the day when it would cost 25 p/kWh or more. In this article, we will explore what the best tariff is and how much you can save on electricity costs using a battery!
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The topic in a nutshell
Tap into off-peak EV rates as low as 7 p/kWh and cut your electricity bill by more than 60%.
This tariff lets you charge at 7 p/kWh over night, but requires a compatible EV charger controlled by Octopus.
Charge overnight, use stored energy by day, and save up to £550 a year on your electricity costs.
Get a personalised assessment for the best home battery and tariff combination in a consultation.
Home batteries can be charged on the same EV overnight tariffs so that during the day you use the electricity and avoid paying significantly higher day rates - very similar to how EV owners have already been saving lots of money by charging their cars overnight. The savings for homeowners depend largely on their electricity tariff and the size of their battery. Let's explore those!
What is the best electricity tariff to charge your battery?
There are many tariffs that let you charge a battery overnight when costs for electricity are low. Most notably the popular Economy 7 tariff offers cheap off-peak electricity at night, compared to more expensive rates during the day. Since the inception of Economy 7 tariffs in the 1980s, electricity suppliers have gone a lot further and introduced various tariffs with multiple rates. For example, there are novel tariffs such as Octopus Cosy for heat pump owners or Octopus Flux for owners of solar panels.
However, for the EV owners amongst you, there are even better off-peak rates available which let you power your home at the lowest possible electricity costs. These tariffs are designed to help homeowners charge their electric vehicle overnight for approximately a third of the day rate. The off-peak rates range between 6.9 and 12.4 p/kWh and are usually accessible between midnight and the early morning. This is significantly lower than the peak rates during the day, which range between 22 and 31 p/kWh.
Caution: Charging your battery doesn’t work on all EV tariffs!
There are three important factors to consider when choosing your tariff:
- The import rates,
- permission to charge a home battery and the
- requirements for accessing the tariff
Many suppliers have claimed to offer the cheapest tariff – so let’s use these factors to compare the most popular EV tariffs we found in July 2024.
Octopus Go
Octopus Go offers an off-peak rate of 8.5 p/kWh between 12:30 and 5:30 am every night. The average peak rate for the rest of the day is at 23.6 p/kWh, but it differs slightly by region. You can combine these import rates with the Outgoing Fixed Lite and Smart Export Guarantee (SEG) rates to sell excess electricity from your solar panels or battery to the grid for up to 8 p/kWh.
You can use Octopus Go to charge your EV and home battery storage, while also powering your home’s consumption during the off-peak window. To make sure your devices charge up on the cheap rates, you’ll need to set up the time-based charging cycle yourself.
There are three requirements to access Octopus Go. First, you need to be an existing Octopus customer (or become one and shortly after you’ll be switched to the Go tariff). Secondly, you need to own- or lease an electric or plug-in hybrid vehicle. You can also access the tariff if you’re just in the process of acquiring the car, as long as you can provide Octopus with an order number. Lastly, you need to have a smart meter or get one installed by Octopus.
Octopus Intelligent Go
The off-peak import rates on Intelligent Go are even lower at 7 p/kWh between 11:30 pm and 5:30 am. The average peak rate is at 23.6 p/kWh, varies by region and is therefore the same as on the Octopus Go tariff. In contrast to the Go tariff, you can export surplus electricity at 15 p/kWh on the Outgoing Fixed tariff.
Similar to the Octopus Go tariff, you can power home’s consumption and battery charge on the Intelligent Go tariff.
You can get additional hours of cheap electricity on Intelligent Go when the grid has a lot of green surplus electricity. In these events, just plug in your car before the official time window and you’ll receive additional off-peak hours. For more info, check out EVNick’s video.
The key difference between these two EV tariffs is that on Intelligent Go Octopus controls your EV charger. Hence, one of the requirements for the tariff is a compatible EV charger that can be controlled by “Intelligent Octopus”. Currently this includes chargers from Ohme, Wallbox and Zappi (Myenergi). Other than that, the same requirements as for the Go tariff apply and you will need to set up the charging cycle for your battery.
EV tariffs from other electricity suppliers
Besides Octopus Energy, British Gas and EDF allow their customers to charge home batteries on EV Tariffs. Their off-peak rates are in the same ballpark as Octopus with 7.9 p/kWh and 8.99 p/kWh respectively. Most EV tariffs from other suppliers either do not allow charging a home battery on the off-peak rates.
Interestingly, you can access similar off-peak rates without owning an EV on Ecotricity. Typically, the EV-tariffs require some proof of ownership for an EV. The Fixed EV tariff from Ecotricity doesn’t and explicitly states that you can access their 8 p/kWh off-peak rate between midnight and 5:00 am without owning an EV. They do require you to have an EV charger installed at your property though.
How much can you save with these tariffs and a battery?
In order to evaluate the savings from using these tariffs with a home battery, we will model the consumption of an average UK household with 4 occupants. In this example, we assume the household doesn’t have a heat pump, but an EV so that we get access to the Octopus EV tariffs. Their daily electricity consumption is at 10 kWh a day (excluding the EV charging) and 3,650 kWh per year.
Electricity costs on Octopus Go before and after adding a battery
In the case without a battery, the household pays already benefits from the off-peak rate of 8.5 p/kWh, while they pay for 24.9 p/kWh during the day. On an annual basis they pay approximately ~£1,000 for electricity.
After installing a 10 kWh battery that covers the household’s daily electricity consumption, they can reduce their electricity bill by ~£530 to ~£470 for electricity. By charging up their battery overnight in parallel to their EV and using that electricity throughout the day, they cut their electricity costs by more than 50%.
Electricity costs on Octopus Go before and after adding a battery
Before adding the battery, the household pays approximately ~£950 annually for their electricity consumption on the Octopus Intelligent Go tariff. This tariff lets them pay 7 p/kWh in off-peak hours and 24.9 p/kWh during peak hours.
After adding a battery, charging it up on the off-peak rate and using that same electricity during the day, they pay ~£400 per year. In comparison to their previous electricity costs, they can save ~£550, cutting their bill by more than 55%!
The Intelligent Go tariff has the best rate for charging up your battery and cutting your electricity costs. However, it is not suitable for everyone as it is only compatible with EV chargers from Ohme, Wallbox and Zappi and some homeowners might not want to give control over their EV charger to Octopus. In that case, the Go tariff would be the better choice as it offers similar savings on electricity costs, but it lets you control the charger.
How to get started with your battery?
Now that the case for charging your home battery on the off-peak rates is clear, you might ask yourself how you can get started. Let’s go through the 3 steps it takes to get started:
1. Configure the battery system
The most important configurations of a battery system are the size of the inverter and the battery’s capacity. The size of the inverter determines how much electricity can be dispatched from the battery to your household simultaneously. Typically, the average household can run on a 3 – 5 kW inverter. The battery’s capacity matters, as it will need to be large enough to cover a day’s worth of consumption outside the off-peak hours. Hence, the battery’s size should match your household’s consumption, like in the example above. In another article we help you find the right size for your home battery, for example, if you want to store electricity from your solar panels or live off-grid with your battery.
2. Get the battery installed
In the next step, you want to find a trusted installer to take care of the installation for you. We recommend working with an MCS-certified installer that does high-quality installations and can give you at least a 5-year warranty for the battery system. We at Capture work with one of the largest installers in the UK. They are MCS-certified and give a 10-year warranty on each system. Get in touch by answering the form at the end of the article.
Getting your EV soon and needing a charger? Add a battery as well and save money. By installing both in one go, you can save ~£500 in installation costs - or in other terms: a whole year’s worth of electricity.
3. Switch to the right tariff & configure the correctly
Lastly, make sure that you are on the right tariff and the battery is configured according to the off-peak windows. Firstly, you want to switch to an electricity tariff that allows for the off-peak charging. Secondly, you want to make sure that your battery’s charging cycles are aligned with the off-peak windows on the tariff.
For example, on the Octopus Go tariff, we would set up your battery so that it charges on the cheap rate between 12:30 and 5:30 am. For the rest of the day, we discharge the battery for your household’s consumption.
This is extremely easy to do in the InstaGen app that we use to operate and monitor our batteries. Just enter the respective time windows for charging and discharging into the app. Setup done!
To sum up, it’s clear how a home battery in combination with an EV-tariff can cut your bills by more than 60%. We at Capture are here to help you get there – starting by getting a quote and an initial consultation to plan the right system with the right electricity tariff for you.
