By Johan du Plessis, CEO at tepeo
Part two of our comparison series: Cost Savings
In part one of this blog series, we explored why a smart heat battery like the ZEB dramatically reduces your carbon footprint compared to a direct electric boiler. But let’s zoom in now on the other side of the coin: the cost.
Whilst reducing emissions is critical, what even the most climate conscious people usually have to consider first is their wallet. And this is where smart heat batteries really come into their own.
The true cost of electric heating
An electric boiler uses electricity at the point when your thermostat says your home needs heat. And unfortunately, electricity is most expensive exactly when people need heating – early in the morning and in the evening. These are also the times when the grid is under the most pressure, and prices spike accordingly. Its simple supply and demand: the higher the electricity demand, the higher the prices. This is particularly true in electricity markets, where failing to meet demand is not an option, so the grid needs to bring more and more expensive generation sources online (largely gas) to keep the lights on.
As tariffs develop and mechanisms like “market-wide half-hourly settlement” come in by 2027, these peak times are set to get even more expensive – we can go into half-hourly settlement in another blog if people are interested.
So while electric boilers, on the face of it, seem like a simple swap for a fossil fuel boiler (no combustion, no emissions at the point of use, and no flue to worry about), that simplicity comes with two massive compromises – cost & carbon – until now!
More flex – cheaper running cost
A smart heat battery like the ZEB draws power when electricity is cheap, stores the energy as heat and then delivers it when needed. It’s not using electricity on demand – it’s using it when it’s cheapest.
With a flexible electricity tariff the ZEB charges itself up when electricity prices are lowest – typically overnight or during the early afternoon. These periods can be up to 75% cheaper per kWh than peak times.
Let’s put that into numbers
A flat rate tariff today gives you a price of electricity of around 27p/kWh. A flexible tariff like EoN Next Drive gives you 6.7p/kWh off-peak and just over 27p/kWh the rest of the day.
Because a ZEB is very flexible, it can get almost all of your heating from the off-peak period. For higher heat demands (larger or less efficient buildings) there will be some additional charging during the day on the coldest days. However over a year the vast majority of electricity consumption will fall in the off-peak period. This flexibility results in enormous savings for consumers.
Assumptions: 40kWh ZEB compared with an electric flow boiler. ZEB optimised for cost using EoN Next Drive tariff, Electric Boiler on a flat rate tariff. Cost includes heating only. ZEB installed inside the heated space of the building.
A household can expect to save between £800 and £2000 a year by switching from an electric boiler to a heat battery like the ZEB. This is an absolute game changer for people who until now have been paying a fortune for their heating.
Over the winter months a typical 3 bed home will need to do some peak charging if using an overnight tariff as you can see in the graph below.
Graph of annual electricity and heating demand across a day based on an EV style tariff (e.g. Eon Next Drive)
If you really want to avoid any peak charging then we recommend using a multi-rate tariff (often marketed as a “Heat Pump” tariff, but most work even better for Heat Batteries) which gives you a few off-peak periods during the day. This will mean even on the coldest days you avoid peak charging. However, with current tariff pricing, most customers will typically be better off on a simple two-rate tariff (often marketed as “Electric Vehicle” tariffs) because the off-peak price is much cheaper on these simpler tariffs.
Graph of annual electricity and heating demand across a day based on a Heat Pump style tariff (e.g. Octopus Cosy)
Looking ahead
As the UK energy system evolves, with more renewables and smarter tariffs, flexibility will continue to win. The price volatility we’re seeing isn’t going away—it’s getting more pronounced. Having a heat battery like the ZEB doesn’t just reduce bills today, but gives you the flexibility (pun intended) to use a range of tariffs in the future.
So while part one of this blog covered how a ZEB reduces your carbon footprint compared to a direct electric boiler, part two makes it clear: it also reduces your bills by a massive amount. If you’re heating with a standard electric boiler today, you’re likely spending 3x more than you need to.
This is one of those rare win-win-win situations whereby households can massively reduce cost and carbon emissions, the Government can decarbonise more homes and the Electricity Network Operators need to spend less money upgrading their infrastructure.
So – particularly if you currently heat your home with an electric boiler – take a look at heat batteries!