Octopus Energy launches new smart tariff helping households save £140 a year | Personal Finance | Finance

Octopus Energy has launched a new smart tariff for households with traditional electric storage heaters, which could help them save around £140 a year.

The ‘Snug Octopus’ tariff automatically schedules traditional storage heaters to start up at the cheapest and greenest times, helping to balance the grid and keep customers warm for less.

The tariff offers up to six hours of “cheap energy” every night with an extra hour in the afternoon.

According to Octopus, this will allow average customers to save almost £140 a year compared to a standard Economy 7 tariff without needing to invest in other low carbon tech.

Storage heaters work by storing heat generated during off-peak hours at night when energy prices are lower and releasing it throughout the day when energy costs are higher.

Around 1.7 million homes in the UK currently use storage heaters, and over 180,000 housing association homes rely on them for heating.

Rebecca Dibb-Simkin, chief product officer at Octopus Energy Group, said: “Many homes struggling with fuel costs use electric storage heaters, making them especially vulnerable to rising energy prices.

“Snug Octopus is designed to help these customers take charge of their heating, adjusting it to fit their personal needs and schedules – all while enjoying the peace of mind that comes from using energy at the cheapest and greenest times.”

Octopus said the tariff aims to give control back to customers, allowing them to adjust their heater’s runtime when needed.

This means they will be able to cut down their energy usage and costs when they want, such as during warmer months.

A new forecast by trusted energy consultancy Cornwall Insight predicts the price cap will rise for households in Great Britain by 1% in January.

This will see energy bills for typical households on a default tariff rise by 1%, or £19 a year, to £1,736 from £1,717.

Households are being urged to check if they can make a saving with a fixed rate deal.

Richard Neudegg, director of regulation at Uswitch.com, said: “There are now a range of fixed deals available that are significantly cheaper than the predicted price cap for January, so it is well worth running a comparison to see how much you could save.