What Are The Different Types of Energy Tariffs?


What’s in this guide?


If you’ve just become financially independent or moved away from home, you might be looking at different energy companies and their tariffs.

But what exactly are tariffs? Which one should you choose? Is there even any difference?

Take a look at this comprehensive guide, which will tell you everything you need to know.

What is an energy tariff?

An energy tariff is primarily an energy companies ‘deal’ for their customer.

For instance, a fixed rate tariff is a deal between the company and the customer that they will get their energy for x amount per kWh for x amount of time.

Like a three bedroom average home might get their energy for £82 a month at a fixed rate for two years.

This means that while their monthly costs might change as they use more or less energy, the actual cost of the energy per unit stays the same, as per the deal or ‘tariff’.

Some of these ‘deals’ may lock you into having your energy supplied by that company for a year, or it could have no set term.

This is one of the ways that tariffs differentiate from each other.

Therefore it’s really important to decide before you take a look at the different tariffs are available what traits you would like it to have.

  • Would you like a tariff with no fixed term so that you can leave at any time?
  • Do you want your energy cost per kWh to be fixed, to avoid big unexpected bills?
  • Would you like your energy to be from renewable sources?
  • Do you value clear, transparent billing so you can understand what you’re paying?

Sometimes you can get everything you want in a tariff; sometimes you might have to compromise.

This is where using an energy comparison tool might come in handy.

It allows you to plug in some of your information such as your location and when you would like to switch. Then, you just sit back and wait to see which tariffs are available to you today.

What are the different types of tariffs?

Now that you have an idea about what tariffs are, you can take a look at the different kinds of tariffs available.


A standard tariff is often the ‘default’ tariff offer from an energy company.

It is usually a variable tariff which means the price of your energy per kWh will rise and fall with the open market.

Similar to stocks, the cost of your energy would depend on current affairs and politics.

It can sometimes mean some savings on your monthly bill, but you do run the risk of having an unexpected larger bill at any time.

✔ No exit fees
✔ No fixed term, switch at any time
✔ Offers flexibility
✔ Offers flexible costs
✗ Usually isn’t the cheapest option available


A fixed rate tariff, as mentioned before, offers guaranteed standing charges and rates for your energy.

This usually also means your costs are only fixed for a certain amount of time, like a year or two.

You are protected from things such as politics or fluctuations in the open market, making it usually one of the most stable and cheapest options on the market today.

✔ Get your energy for a set cost
✔ Be protected against rising prices
✔ Know what you’re paying
✔ Budget easier as you’ll know your energy costs
✔ Cheaper than standard variable rates
✗ You will not benefit from any price decreases

Dual fuel

A dual fuel tariff is another way of saying that you will get both your electricity and gas from the same energy company.

Sometimes, suppliers will offer you a decent discount for getting both of your energy needs from them, plus things like paperless billing and paying by direct debit.

Usually, fixed-rate tariffs, standard variable tariffs and online tariffs will all be open to dual fuel customers.

✔ Benefit from dual fuel tariffs
✔ Cheaper deals
✔ Get potential discounts
✔ You can still have a choice of a fixed or variable tariff
✔ Only deal with one supplier
✗ Sometimes it isn’t the cheapest option, so make sure to compare!

Online energy tariffs

Online energy tariffs, as the name suggests, is a tariff that you manage only via the internet that often means getting a discount in return.

Instead of getting your bills through the post, you would view them online and submit readings through your energy suppliers website.

✔ Get a discount
✔ Help save the planet by not using paper
✔ It might be the very cheapest tariff
✔ Manage everything online or via an app
✗ Not for customers that like getting their bills through the post

Prepayment tariffs

Prepayment tariffs enable customers to be able to pay for their energy before they use it.

This is for people who have a prepayment meter, and it’s usually used when you have a debt to your energy company that you need to pay off in manageable chunks.

The cheapest prepayment tariff is often more expensive than the cheapest fixed rate tariff, so you should only have one if it’s completely necessary.

✔ Manage your debts
✔ Budget even easier
✗ Costly rates
✗ Your supplier might not let you switch to a standard credit meter
✗ Limited tariff options
✗ Your power may be immediately shut off if you can’t top up
✗ Inconvenient topping up at local shops

Green energy tariffs

Green energy tariffs can mean either of these things; your energy supplier is providing you entirely renewable energy from a source such as solar panels or wind farms, or they will contribute to environmental schemes on your behalf.

The benefits include helping the environment, supporting local renewable energy generators and sometimes your payment will go towards building new wind or solar farms.

✔ Some green energy tariffs are the same price as fixed rate tariffs
✔ Help the environment
✔ Support renewable energy generators
✔ Get a great deal on your energy
✗ Some green energy deals are more expensive

Economy 7 tariffs

Economy 7 refers to a tariff that means that for seven hours usually between the hours of 10:30 pm and 8:30 am, your energy will cost less than it does in the day.

It requires that you have a special meter which allows you to have two rates, one for the day and one for the night.

So if you work nights or use at least 40% of your energy at night, this could be the best tariff for you.

✔ Cheaper night rates
✗ More expensive power in the day


Which energy tariff would be best for you?

Would you like to learn more about your energy?

Did you know that you could be saving £200 a year on your energy bills?

Take a look at the EnergySeek guides to find out more about your energy, or see reviews of the top 7 energy switching sites to compare gas & electricity.