If you want to take better control of your home energy – whether by learning more about solar energy or exploring the latest smart tariffs – you're likely to come across a lot of jargon.
Here’s a run-down of common energy terms you might encounter, and how they impact your energy use and costs.
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An agile tariff is a smart electricity tariff that adjusts prices every half hour based on the wholesale energy market. It benefits those who can shift energy use away from peak times, typically 4–7 PM when prices are higher. Outside of peak hours, prices are often lower and may come from renewable sources, with occasional negative pricing where you're paid to use excess green energy. Agile tariffs are ideal for users with electric cars, heat pumps, home batteries, and other high-energy devices.
An air source heat pump transfers heat from outside air to water, which is then used to heat your home through radiators or underfloor heating, and to provide hot water for taps and showers. It works by absorbing heat from the air into a fluid, which is passed through a heat exchanger to raise its temperature. Air source heat pumps are common in the UK and can help lower energy bills, reduce energy use, and cut carbon emissions by using electricity instead of fossil fuels.
The 'big six' refers to the largest energy companies in the UK. Historically, they were British Gas, EDF Energy, E.ON, npower, ScottishPower, and SSE. While the market has changed, the current big six are British Gas, EDF Energy, E.ON Next, Octopus Energy, OVO Energy, and ScottishPower.
Bill shock is the surprise and frustration a customer feels when their bill unexpectedly increases. But by tracking your usage and understanding your consumption patterns, you can avoid any nasty surprises and find ways to reduce costs.
A combi boiler provides both heating and hot water directly from the mains without needing a separate cylinder. It's a compact, popular choice in the UK, offering fast hot water and space-saving efficiency, with some models being over 90% efficient.
A carbon footprint is the total amount of greenhouse gases, measured in CO₂e, produced by an individual, product, or country through their activities. In the UK, the average annual carbon footprint per person is about 13 tonnes, including emissions from all goods and services consumed.
A dual fuel tariff provides both gas and electricity from the same supplier, combining them into one bill. It offers convenience and sometimes discounts, though it may not always be the cheapest option.
Demand side response (DSR) balances electricity supply and demand by adjusting usage. It helps manage peak demand, match renewable generation, lower energy bills, reduce carbon footprints, and prevent power outages. DSR can be automated, like scheduling EV charging during off-peak hours, or manual, such as running appliances at night. It supports the transition to a low-carbon energy system.
An Economy 7 tariff offers cheaper electricity rates at night - usually from midnight to 7 AM, and higher rates during the day. It’s ideal for those who use more electricity at night, like charging an EV or running storage heaters. Economy 7 requires a special meter with two readings for day and night rates. While the price gap between day and night rates has decreased, the tariff may include higher standing charges or daytime rates.
An electric vehicle (EV) is powered either by an electric motor and battery or a hydrogen fuel cell that generates electricity. EVs include battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), and hydrogen fuel cell electric vehicles (FCEVs). Choosing an EV can lower your running costs and reduce your carbon footprint. With a growing range of models - especially second hand, and increasing environmental concerns, EVs are becoming a more attractive option.
An Energy Performance Certificate (EPC) rates a building's energy efficiency from A (very efficient) to G (inefficient) and is valid for 10 years. It estimates heating and lighting costs, carbon emissions, and includes recommendations for improvements. EPCs are required when a property is built, sold, or rented, and landlords cannot rent properties rated F or G unless exempt. Exemptions include small buildings, those for demolition, and listed buildings that would be altered by meeting energy standards.
The Feed-In Tariff (FIT) was a government scheme that paid fixed rates for both generating and exporting renewable energy, benefiting households with stable, long-term payments. It closed to new applicants on April 1, 2019, and was replaced by the Smart Export Guarantee (SEG), which compensates only for exported energy. Unlike the FIT, the SEG operates on a market-driven model, meaning rates can fluctuate as set by suppliers.
A fixed tariff is an energy plan where the price of gas and electricity remains constant for a set period, usually 12–18 months, regardless of market fluctuations. It offers price stability and certainty, unlike variable tariffs which change with the wholesale energy market.
A green tariff is an electricity plan where some or all of the energy comes from renewable sources such as wind, solar, or hydro. Available through utilities and often certified by public utility commissions, these tariffs can be purchased alone or as an add-on. When choosing a green tariff, verify the actual renewable content, check for Renewable Energy Guarantee of Origin (REGO) certificates, and watch out for misleading claims. Green tariffs might also come with a higher cost compared to standard plans.
A ground source heat pump extracts heat from the ground to heat your home’s radiators or underfloor heating and also warms water for taps and showers. It uses a loop of pipe buried in your garden, filled with a thermal transfer fluid (brine), to absorb ground heat. This heat is then transferred to water via a heat pump. Ground source heat pumps can lower energy bills, reduce overall energy use, and cut carbon emissions compared to gas or oil boilers.
A home battery is a rechargeable unit that stores excess electricity from solar panels or other sources for use when energy generation is low, such as at night or during cloudy days. It helps reduce electricity bills, increases renewable energy use, and eases grid demand.
An in-home display (IHD) is a portable screen that provides real-time information on your energy usage and costs by connecting wirelessly to your smart meters. It allows you to set and monitor budgets, check your current balance and see how much energy you’re using and what it’s costing. IHDs are mobile, and energy suppliers are required to maintain them for 12 months after installation.
Home insulation is a barrier that keeps heat from escaping or entering your home, maintaining warmth in winter and coolness in summer. Installed in walls, floors, and ceilings, it can significantly lower heating and cooling costs, enhance comfort, and reduce carbon emissions. An uninsulated home loses around a third of all heat through walls and a quarter of heat through the roof. The two insulation measures to consider are cavity wall and loft insulation. While they come at a cost, these measures will pay themselves back quickly.
A kilowatt-hour (kWh) is a standard measure of power that measures electrical energy used over one hour at a power of one thousand watts. For instance, a 1,000-watt appliance running for one hour consumes one kWh. Alternatively, a 500-watt appliance running for two hours or a 250-watt appliance running for four hours also use one kWh. Electricity providers charge based on the kWh used, with rates varying by provider. This information helps monitor usage and compare tariffs. The Energy Guide label on appliances estimates yearly usage, which can be multiplied by the kWh rate to calculate operating costs.
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LED (light-emitting diode) bulbs are a highly durable and energy-efficient lighting option. Unlike traditional bulbs like halogen or incandescent, LEDs offer comparable or superior light quality and can last up to 25-30 years. They are robust, compact, and provide focused light, making them ideal for various applications like under-cabinet lighting. Initial costs are as low as £1 and energy bills can be reduced significantly by switching to LED bulbs.
MPAN, or Meter Point Administration Number, is a unique 21-digit identifier for electricity supply points in Great Britain. Also known as a supply number or S-number, it can be found on your electricity bill. MPANs help identify your property’s electricity supply and are distinct from gas meter numbers (MPRN).
Micro combined heat and power (micro-CHP) boilers generate both heat and electricity from a single energy source, similar in size to standard domestic boilers. They can be wall-mounted or floor-standing. Micro-CHP systems offer low-carbon benefits by being more efficient than using fossil fuels for heat and electricity separately. They can replace conventional gas boilers and provide greater efficiency by combining heating and power generation in one unit.
Net zero refers to balancing the amount of carbon emitted with the amount removed from the atmosphere. Achieving net zero involves reducing emissions from homes, transport, agriculture, and industry, and addressing residual emissions through methods like enhanced carbon absorption or carbon capture technology. The UK aims to reach net zero by 2050, but significant progress is needed by 2030 to meet this target.
Off-peak hours are times of low electricity demand, typically late at night and early in the morning, when rates are lower. They occur when fewer people are using electricity, such as while sleeping. Using energy during off-peak hours can reduce energy bills with time-of-use tariffs like Economy 7, which offer lower rates during these periods. Smart meters track energy usage accurately, enabling these variable tariffs. In contrast, peak hours, such as evenings, see higher demand and potentially higher electricity prices.
Ofgem, or the Office of Gas and Electricity Markets, is a UK regulatory authority overseeing gas and electricity networks. Its key roles include setting price controls, enforcing compliance, promoting environmental improvements, protecting consumers, and supporting policies like decarbonisation. Ofgem ensures that energy companies adhere to regulations and serve consumer interests fairly.
Passivhaus, or "passive house," refers to buildings designed to high energy efficiency standards that maintain a nearly constant temperature with minimal heating or cooling. These buildings are exceptionally well-insulated and ventilated, relying on passive solar heat and internal activities. Developed by the Passivhaus Institute in Germany, the certification requires adherence to specific planning principles. Builders must use the Passivhaus planning system to meet the rigorous energy efficiency criteria.
Phantom Load refers to the energy consumed by appliances left on or in standby mode, contributing to your energy bill without you necessarily knowing. This includes old or faulty electronics left plugged in, forgotten appliances and devices with high running costs. Turning off devices rather than leaving them on standby can reduce costs, but identifying and managing forgotten or high-energy appliances offers the greatest savings.
A prepayment tariff, or pay-as-you-go (PAYG) tariff, requires payment for energy before use. It works with prepayment or smart meters in prepayment mode. You top up your meter using a key, card, token, or online, and can do so at locations like the Post Office or Payzone.
Introduced in January 2019, the energy price cap, set by Ofgem, limits the maximum amount you can be charged for gas and electricity, covering both standing charges and unit prices. Standing charges are fixed daily fees, while unit prices are the cost per unit of energy used. The cap is reviewed and adjusted quarterly, in January, April, July, and October, potentially leading to seasonal price changes. The cap applies to default tariffs, often called standard variable or Price Cap tariffs. Although rates may change, they won’t exceed the cap, and your supplier must notify you of any adjustments.
Renewable energy comes from natural sources that are continuously replenished and won't run out. These sources include wind, solar, hydroelectric (including tidal), ocean, geothermal, biomass, and biofuels. Also known as sustainable or green energy, renewable energy is a cleaner alternative to fossil fuels, producing lower emissions and contributing to a safer, more sustainable world. It's often cheaper than fossil fuels, generates jobs, and is available globally.
The Smart Export Guarantee (SEG) pays you for exporting surplus renewable energy to the grid. Launched in 2020 to replace the Feed-in Tariff, SEG encourages green technology by compensating homeowners for extra energy produced. Through the scheme, participating energy suppliers offer an 'export tariff' to reimburse you for the electricity you send to the grid.
Smart meters track your gas and electricity usage and send readings directly to your supplier. They consist of two parts: the meter, which transmits data wirelessly, and an in-home display that shows real-time usage and costs. Benefits include more accurate bills, potential savings, and insights into energy consumption. Although not mandatory, smart meters enable access to time-of-use tariffs and eliminate the need for manual meter readings. To get one, contact your energy provider for installation details.
Smart plugs automate your wired devices. Simply plug the smart plug into an outlet, connect it to your Wi-Fi and then plug your appliance into it. You can control the device remotely through your phone or tablet. If you have a smart home hub, you can also use voice commands to control your devices. Smart plugs help save on energy bills by allowing you to schedule when devices turn on and off, ensuring they’re only active when needed.
Smart thermostats connect your heating system to the internet, allowing you to control and schedule your heating remotely via a smartphone app. You can adjust settings from anywhere, whether you're home or away. Key features often include multi-room control, hot water management, geofencing, and various modes for safety and efficiency. Not all models have every feature, but many offer advanced options to enhance comfort and energy savings.
Solar panels convert sunlight into electricity using photovoltaic (PV) cells made from materials like silicon, which generate an electric charge when exposed to light. This charge is captured and converted into usable electricity through an inverter. They offer clean, renewable energy, help reduce greenhouse gas emissions, lower electricity bills, and require minimal maintenance with a long lifespan.
Solar water heating systems, or solar thermal systems, use sunlight to heat water stored in a cylinder or thermal store. These systems typically don't provide all the hot water needed year-round, so a conventional boiler or immersion heater is often used to supplement. While larger setups can contribute to home heating, they usually account for less than 10% of the total requirement, making them primarily suited for hot water needs like bathing and showering.
A standard variable tariff is an energy plan where rates rise or fall with market prices, unlike a fixed tariff that maintains a consistent rate throughout the contract period. This type of tariff is typically the default option offered by suppliers. With a standard variable tariff, your energy costs can fluctuate based on market conditions, potentially lowering bills when prices decrease but increasing them when prices rise. In the UK, a government-imposed price cap on standard variable tariffs is reviewed quarterly—April, July, October, and January.
Time-of-use tariffs offer varying energy prices depending on the time of day or week. Energy is typically cheaper during off-peak hours, such as when demand is low or renewable energy generation is high. For example, using energy during periods of high renewable production or charging an electric vehicle at night can be more cost-effective with these tariffs. Older examples include Economy 7 and Economy 10, while newer options like electric vehicle tariffs and tracker tariffs are also available. To benefit from time-of-use tariffs, you need a smart meter, which provides half-hourly readings to determine accurate charges based on your usage patterns. These tariffs are optional and can help you save on energy bills by better aligning your usage with lower rates.
Vehicle-to-grid (V2G) technology enables electric vehicles (EVs) to interact with the power grid by both sending and receiving energy. EVs can be charged during times of high renewable energy production, such as from solar or wind, and discharge energy back into the grid when demand is high. V2G also allows for adjusting the charging rate to help balance the grid and store renewable energy for later use. This technology aids in grid stability, maximises renewable energy use, reduces costs for EV owners and network providers, and helps prevent power surges.
A virtual power plant (VPP) integrates various decentralised energy sources, such as rooftop solar panels and EV chargers, to manage and balance grid power. Operated by a central control system, VPPs aggregate small energy resources to enhance grid stability and respond quickly to market signals. They provide real-time balancing of energy supply and demand, minimising strain on the public grid. Electric vehicles (EVs) are crucial in the operation and scheduling of VPPs.
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