What is the cheapest UK heat-pump tariff in May 2026?

It depends on your usage pattern. For households with predictable schedules and 5+ kWh/day of shiftable load, Octopus Cosy (cheap rates 4am-7am, 1pm-4pm, 10pm-12am) is typically cheapest at ~12-13p/kWh in those windows. For tech-savvy households happy to use smart automation, Octopus Agile averages ~14-16p/kWh blended but can hit negative pricing in surplus-wind periods — great savings if you can react. British Gas HomeEnergy heat-pump tariff (cheap rate 11pm-5am) is competitive at ~13p/kWh and simpler for households without home automation. Avoid Economy 7 — it's designed for storage heaters not heat pumps and the rate gap is too narrow.

What is weather compensation and why does it matter?

Weather compensation (sometimes called 'weather curve' or 'load compensation') is a control feature where the heat pump's flow temperature scales with outdoor temperature: cold day = higher flow temp, mild day = lower flow temp. This matters because heat pump efficiency (COP) drops sharply at higher flow temperatures, so you want the LOWEST flow temp that still keeps the house warm. A well-tuned weather compensation curve typically improves seasonal COP by 15-25% vs a fixed flow temperature. Almost every UK heat pump sold post-2020 supports this; many are installed with it OFF or poorly tuned. Ask your installer during commissioning to set up + show you the weather-comp curve, and tune it across the first winter (lower the curve a few degrees at a time until you hit the comfort floor).

How do I schedule the heating to use cheap-rate hours?

Two approaches depending on your heat pump's controls. Standard: use the heat pump's built-in scheduler (every modern unit has one) to set a higher target flow temperature during cheap-rate windows and a 'maintenance' temperature outside them — the system pre-warms the house during cheap hours and coasts through expensive hours. Aim to FINISH the warming push 30-60 minutes before the cheap window ends so the house has heat reserve for the peak period. Advanced: smart controllers like Homely, Adia, or Home Assistant integrations let the system make these decisions dynamically based on weather forecast + tariff price feed. The basic scheduler covers 70-80% of the savings; the smart controllers chase the last 20%.

Can I run a heat pump on Economy 7?

You can but it's almost always the wrong choice. Economy 7 has a 7-hour night rate (typically 12-7am or 1-8am, varies by region) that's only 30-40% cheaper than the day rate. Heat-pump-specific tariffs like Octopus Cosy have rates 50-60% cheaper in their cheap windows and offer additional cheap periods during the day, when you actually want to be heating. The main reason to consider E7 is if you already have a storage-heater contract that's hard to switch — in that case look at heat-pump tariffs at next renewal. The other case: rural Scotland where heat-pump-specific tariffs are limited; E7 may be the practical default until more suppliers extend coverage.

What's the difference between fixed-window and dynamic tariffs?

Fixed-window tariffs have the same cheap-rate hours every day — Octopus Cosy is 4am-7am, 1pm-4pm, and 10pm-12am, day in day out. You program the heat-pump schedule once and forget it. Dynamic (or 'agile') tariffs have prices that change every 30 minutes based on the wholesale electricity market — sometimes negative (you get paid to use power), sometimes 35p+/kWh during evening peaks. Octopus Agile and Tracker are the main UK options. Dynamic tariffs typically average 15-25% cheaper than fixed-window for households that automate their consumption, but you need a smart controller that can pull the day-ahead price feed and shift loads automatically. For most homeowners, fixed-window is the right starting tariff; consider dynamic once you've lived with a heat pump for 6-12 months and want to optimise further.

Do I need a smart meter to use a heat-pump tariff?

Yes — every heat-pump-specific UK tariff requires a SMETS2 smart meter (the second-generation smart meter, with WAN connectivity to the central data communications company). The meter sends half-hourly consumption to your supplier so they can bill the time-of-use rates correctly. If you don't already have one, your supplier will install one free as part of the tariff onboarding. SMETS1 meters from before 2018 may need a firmware update or replacement to work with HH settlement. Worth checking before you sign up — booking the smart-meter install adds 2-6 weeks to the tariff switch.

Setting up a heat pump smart tariff: UK 2026 guide

The three pillars of a low-running-cost heat pump

Three things determine how much your heat pump costs to run after the install is commissioned:

The tariff you’re on. Standard variable vs heat-pump-specific can be 25–40% difference on the same usage profile.
Weather compensation tuning. Whether the heat pump runs the LOWEST flow temp the house can tolerate. 15–25% impact on seasonal COP.
The schedule.Whether you’re shifting consumption into the cheap hours of your tariff. 10–30% impact depending on tariff shape.

Done together, the three can take a heat pump from “running cost slightly worse than gas” to “30–50% cheaper than gas”. The gap matters because it determines whether the install actually pays back over its lifetime.

UK heat-pump tariffs in May 2026 — the lineup

Fixed-window tariffs

These have the same cheap-rate hours every day. Easy to set up; you program the heat-pump scheduler once and forget about it.

Octopus Cosy — three cheap windows per day (4am–7am, 1pm–4pm, 10pm–12am). Most popular heat-pump tariff in the UK. Cheap rate ~12–13p/kWh, peak ~38p/kWh. Eligibility: must have a heat pump or EV; SMETS2 smart meter required.
British Gas HomeEnergy — single cheap window 11pm–5am at ~13p/kWh. Simpler than Cosy but with less daytime flexibility. Works well for households that can pre-heat overnight and coast.
EDF GoElectric Heat Pump — cheap window 12am–5am at ~14p/kWh. Similar shape to British Gas; better for some regions.

Dynamic tariffs

Prices change every 30 minutes based on the wholesale market. Bigger savings potential but requires a smart controller that can react to price changes.

Octopus Agile — half-hourly pricing published the previous afternoon at 4pm. Can hit negative pricing in surplus-wind periods. Average ~14–16p/kWh for a heat-pump household that automates.
Octopus Tracker — daily pricing (not half-hourly) tied to the wholesale day-ahead rate. Less volatile than Agile; easier to schedule a day in advance. Average ~13–15p/kWh.

Weather compensation — the single biggest tweak

Heat-pump efficiency (COP) is fundamentally a function of the temperature difference between the heat source (outside air) and the heat sink (your radiators). The smaller the gap, the higher the COP.

Rough rule: every 5°C lower flow temperature gives ~10–15% better COP. So running at 35°C flow on a mild day vs 50°C gives ~30–40% better efficiency than running a fixed 50°C all winter.

Weather compensation automates this — the heat pump reads outdoor temperature and adjusts flow temperature on a curve. Cold day = higher flow temp to compensate for higher heat loss; mild day = lower flow temp because the house doesn’t need much.

A typical UK weather-comp curve for a well-insulated post-1990 home:

−3°C outside: 50°C flow
+2°C outside: 42°C flow
+7°C outside: 35°C flow
+12°C outside: 30°C flow (or off)

Most installers commission with a conservative curve that errs warm. Tune it down across the first winter: lower the curve a couple of degrees, live with it for a week, check comfort. Iterate until you hit the threshold where comfort drops, then go back one notch. This is the biggest single saving you can make post-install — and it’s free.

Scheduling — push consumption into cheap windows

The basic pattern for any time-of-use tariff:

Pre-heat the house during cheap-rate windows. Bump the room thermostat target up by 1–2°C starting 1–2 hours before the cheap window starts; target reaches the higher temp by mid-window.
Coast during expensive windows. Drop target back to a maintenance setpoint (e.g. 18°C); house stays comfortable on thermal mass.
Hot-water cylinder cycle sits entirely inside a cheap window. Schedule the 2–4 hour cylinder reheat in the longest cheap block.

Practical example — Octopus Cosy schedule for a 4-person household:

4am–7am cheap window: heating target 21°C (pre-warm for morning). Cylinder reheats here.
7am–1pm peak rate: heating coast to 18°C maintenance.
1pm–4pm cheap window: heating target 20°C (pre-warm for evening).
4pm–10pm peak rate: heating coast. House stays warm on thermal mass + radiator residual.
10pm–12am cheap window: top-up to 19°C; quick boost before bed if needed.

Smart controllers — what each one actually does

For dynamic tariffs (Agile, Tracker) you need a smart controller that pulls the day-ahead price feed and shifts loads in response. Three popular UK options:

Homely — heat-pump-native controller launched by an MCS-affiliated startup. Plug-and-play with most ASHP brands; pulls Octopus Agile prices automatically and adjusts the schedule daily. £200 unit + ~£10/month subscription. Easiest setup.
Adia — similar concept, partnered with Octopus directly. Slightly cheaper monthly fee.
Home Assistant — DIY route. Free software, runs on a Raspberry Pi (~£60). Maximum flexibility but requires technical setup. Community maintains integrations for most heat pumps + Octopus tariffs.

For fixed-window tariffs (Cosy, BGE HomeEnergy) you don’t need a smart controller — the heat pump’s own scheduler is enough.

SMETS2 smart meters — the gatekeeper

Every UK heat-pump tariff requires a SMETS2 (second generation) smart meter. The meter reports half-hourly consumption to your supplier via the central DCC (Data Communications Company) network — that’s how they bill the time-of-use rates correctly.

If you already have one, you’re ready. If not, your supplier will install one free during tariff onboarding. SMETS1 meters (installed 2014–2018) may need firmware updates to support half-hourly settlement; some need full replacement. Lead time: 2–6 weeks for a new install or upgrade booking.

Confirm meter status before you sign up to a smart tariff — “need smart meter installed first” is the most common onboarding delay.

What to do in your first month on a smart tariff

Day 1–7:Watch the consumption pattern in your supplier’s app. Note when peaks happen.
Day 7–14: Set up the basic schedule (pre-heat in cheap windows, coast in peaks). Adjust the cylinder cycle to sit in the longest cheap block.
Day 14–28: Tune the weather-comp curve down 1–2 degrees per week until comfort drops, then back off one step.
Day 28–60: Review billed cost. Compare to the same month on a flat-rate tariff — most households see 25–35% reduction once schedule + comp are tuned.
End of winter: Consider switching to a dynamic tariff (Agile / Tracker) if you want to chase additional savings.

The summary

A heat-pump install only realises its full running-cost advantage when paired with a heat-pump-specific tariff, weather compensation, and a schedule that pushes load into cheap-rate hours. Start with a fixed-window tariff (Cosy or BGE HomeEnergy), get weather compensation enabled at commissioning, and tune the schedule across the first month. Once you’re confident, consider stepping up to a dynamic tariff with a smart controller for the last 10–20% of savings. These three pieces together typically take the running-cost gap vs gas from break-even to clearly cheaper — which is the case for the install paying back over its 15+ year life.

Setting up a heat-pump smart tariff in UK 2026