EDF recently launched a new energy tariff featuring three distinct pricing tiers. The FreePhase tariff by the energy company offers rates that vary based on daily fluctuations in wholesale energy prices. These rates are categorized into three time-of-use bands: red (peak), amber (off-peak), and green (night). The concept behind this tariff is to encourage customers to shift their energy consumption to times of the day when rates are lower, potentially leading to cost savings.
According to EDF, customers can potentially save up to £187 annually on their electricity bills compared to standard variable rates. The peak red rates are effective from 4 pm to 7 pm, while the off-peak amber period spans from 6 am to 4 pm and 7 pm to 11 pm, with the night green rates applicable from 11 pm to 6 am.
The FreePhase tariff is available in two versions: Dynamic and Static. The Dynamic option adjusts unit rates based on wholesale electricity prices, offering off-peak rates up to 30% cheaper and night rates up to 44% cheaper than the standard variable tariff. On the other hand, the Static version locks in rates for 12 months, with off-peak rates approximately 16% cheaper and night rates up to 35% cheaper compared to the standard variable tariff.
Both FreePhase tariffs necessitate a smart meter for half-hourly readings and require payment via Direct Debit, without any early exit fees. Customers may receive free electricity during periods of negative wholesale market prices, typically occurring when there is excess renewable energy and low electricity demand.
For FreePhase Static customers, energy credits are issued back to their account, while Dynamic customers do not incur charges for electricity usage during the free electricity period. Over the past year, an estimated 192 hours of equivalent free electricity were available to customers. Registration for the FreePhase tariff can be completed on the EDF website.
Rich Hughes, EDF’s Director of Retail, expressed enthusiasm about the FreePhase launch, highlighting its simplicity in allowing customers to monitor daily energy prices easily and adjust their electricity usage without the complexity of analyzing intricate pricing structures. He emphasized the benefits of free electricity periods when prices dip below zero, offering savings in both costs and carbon emissions.
This launch comes amid recent increases in energy bills, with the Ofgem price cap rising from £1,720 to £1,755 for a typical dual fuel household paying by direct debit.