Rates and tariff details in this guide are illustrative and verified as of August 2026. Tariff structures and rates change frequently; always confirm current pricing directly with the supplier before switching.
A heat pump is only as cheap to run as the electricity that powers it. It’s an efficient technology by design, but stick it on a standard variable tariff paying upwards of 24p per kWh for every unit it draws, and a meaningful chunk of that efficiency gets quietly eaten by the unit rate. This is the bit that often gets missed at the quote stage: the tariff you choose can do more to shape your annual running costs than almost any other single decision you make after installation.
This guide looks at how heat pump-specific tariffs work, what actually matters when comparing them, and where the common mistakes are made.
Why tariff choice matters so much for heat pumps
A heat pump typically uses somewhere in the range of 3,000-5,000 kWh of electricity per year for an average UK home, depending on property size, insulation, and the system’s SCOP (Seasonal Coefficient of Performance). On a standard variable rate, that can mean a heating bill running into four figures. Dedicated heat pump tariffs (structured around off-peak windows) can meaningfully reduce that, provided the heat pump’s schedule is actually set up to take advantage of the cheap periods.
That last point matters more than people expect. A time-of-use tariff only helps if your heat pump (or a smart control layered on top of it; see our smart heating controls guide) is actually programmed to favour the off-peak windows. Left unmanaged, a heat pump will happily draw power at peak rates just as readily as off-peak ones.
How heat pump tariffs work
Most dedicated heat pump tariffs are structured around one of two models:
- Fixed off-peak windows — cheaper rates apply during set hours each day (commonly early morning, early afternoon, and sometimes late evening), with a standard or peak rate outside those windows
- Fully dynamic/agile pricing — rates change throughout the day (sometimes half-hourly) based on wholesale electricity prices, requiring more active management but potentially offering the lowest rates for engaged users
The key trap with fixed-window tariffs is that a very low off-peak rate is sometimes paired with a steep peak-rate penalty, particularly across the 4pm–7pm window when national electricity demand is highest. A tariff that looks like the cheapest option on its headline off-peak rate can end up costing more overall if your household naturally uses a lot of energy during that peak window and can’t easily shift it.
What actually matters when comparing tariffs?
- Off-peak rate — the headline number most comparisons lead with
- Peak rate — arguably more important, since an unusually high peak rate can outweigh savings from a low off-peak rate if your usage isn’t fully shiftable
- Width and timing of off-peak windows — a tariff with off-peak hours that align with when your heat pump and hot water cylinder actually need to run is more useful than one with a lower headline rate but badly-timed windows
- Smart meter requirement — virtually all time-of-use tariffs require a working SMETS2 smart meter sending half-hourly consumption data; older SMETS1 meters or non-communicating meters won’t qualify
- Whether your controls can exploit it — a manufacturer app, smart thermostat, or heating controller that lets you schedule heating and hot water into off-peak windows — is what actually turns tariff savings into real bill reductions
Comparison: leading heat pump electricity tariffs
| Tariff | Supplier | Off-peak window(s) | Approx. off-peak rate | Approx. peak rate | Smart meter required |
|---|---|---|---|---|---|
| Cosy Octopus | Octopus Energy | Three daily windows (early morning, afternoon, and a further evening slot) | ~14–15p/kWh | Steep — ~45–55p/kWh (4–7pm) | Yes (SMETS2) |
| Octopus Agile | Octopus Energy | Fully dynamic, changes half-hourly | Varies — can fall well below other tariffs | Varies — can spike at peak demand | Yes (SMETS2) |
| Intelligent Octopus Go | Octopus Energy | Single flat window (commonly overnight) | Low flat overnight rate | Standard rate outside window | Yes (SMETS2) |
| EDF Heat Pump Tracker | EDF Energy | Off-peak windows, moderate peak penalty | Moderate | Less punishing than steeper tariffs | Yes (SMETS2) |
| British Gas Heat Power | British Gas | Off-peak windows; eligibility tied to confirmed heat pump ownership | Moderate | Standard | Yes (SMETS2) + ownership verification |
| Good Energy heat pump tariff | Good Energy | Off-peak window including early-morning slot covering UK morning heating peak | Among the lower off-peak rates available | Standard | Yes (SMETS2) |
Common mistakes to avoid
- Switching before your smart meter is confirmed working. If the meter isn’t sending half-hourly data, the supplier will typically hold you on a standard rate until it is; switching too early can mean weeks without the tariff you signed up for actually applying.
- Letting the heat pump run unmanaged. Without a schedule favouring off-peak windows, a time-of-use tariff won’t deliver its expected savings; the heat pump will draw at whatever rate happens to be in effect.
- Choosing the lowest off-peak rate without checking the peak rate. As above, a very cheap off-peak window paired with a steep peak penalty can catch out anyone whose usage isn’t fully shiftable, particularly households who are home and heating in the early evening.
Does solar or battery storage change the maths?
Yes, meaningfully. If your home has solar panels and useful daytime demand, the calculation shifts: rather than relying purely on cheap import windows, solar reduces the amount of electricity you need to import in the first place. Adding battery storage on top allows further shifting of self-generated or cheap off-peak electricity into periods when it would otherwise be needed at a higher rate. Households with solar and/or battery storage are often better served by a tariff that rewards exporting surplus generation, alongside, rather than instead of, a heat-pump-friendly off-peak structure.
What’s changing: Market-Wide Half-Hourly Settlement
The Department for Energy Security and Net Zero is rolling out Market-Wide Half-Hourly Settlement (MHHS) across 2026 and 2027, which will require every domestic electricity supplier to settle customer usage on a half-hourly basis. In practice, this is expected to expand the range of genuinely responsive time-of-use tariffs available, since suppliers will have accurate half-hourly data for every customer rather than only those on specific smart tariffs already. It’s worth keeping an eye on new tariff launches as this rollout progresses, since the current tariff landscape is likely to broaden over the next year or two.
FAQs
Do I need a smart meter for a heat pump tariff?
Yes — virtually all time-of-use and dedicated heat pump tariffs require a working SMETS2 smart meter sending half-hourly consumption data to qualify.
Is Economy 7 good enough for a heat pump?
It can work, but dedicated heat pump tariffs are generally better suited, since Economy 7 night rates and daytime penalties are often less favourable than tariffs specifically structured around heat pump usage patterns.
What’s the difference between a fixed-window and a dynamic tariff?
A fixed-window tariff (like Cosy Octopus) offers set off-peak hours each day at a predictable rate. A dynamic tariff (like Octopus Agile) changes price throughout the day based on wholesale electricity prices, potentially offering lower rates but requiring more active management.
Will switching tariffs alone reduce my heating bill?
Only if your heat pump’s schedule is actually set up to take advantage of the off-peak windows. Switching tariff without adjusting how and when your heating and hot water run won’t deliver the full expected savings.
Does having solar panels change which tariff is best?
Yes — solar reduces how much electricity you need to import in the first place, which changes the calculation. Households with solar, and especially those with battery storage, are often better served by tariffs that reward exported generation alongside a heat-pump-friendly off-peak structure.
Final thoughts
The right tariff isn’t simply “whichever has the lowest headline off-peak rate”; it’s whichever structure actually matches how your household uses heat and hot water and whether your controls are set up to exploit it. For most heat pump owners, a fixed-window tariff like Cosy Octopus or EDF Heat Pump Tracker offers a reasonable balance of savings and simplicity, provided the peak-rate window doesn’t clash badly with your evening routine. More engaged households comfortable with variable pricing may do better on a fully dynamic tariff like Agile, but that comes with more day-to-day management.
As with the heat pump itself, the tariff works best when it’s not treated as a “set and forget” decision made once at installation. Review it once you have a full winter’s real usage data, rather than switching repeatedly based on short seasonal snapshots or headline rates alone, and keep in mind that this is a fast-moving space, so it’s worth rechecking current tariffs and rates periodically rather than relying on any comparison (including this one) indefinitely.