Storage heater economics

[Stinsy]

It has been a while since I installed the storage heater, the cold weather is now here and it is doing a good job of keeping the garden office nice and warm. However I’m not quite convinced about the payback.

I pay 15p peak, and 5p off-peak per kWh for electricity. The storage heater charges for 4hrs and pulls 1kW. So I pay a day 20p to charge it, saving 40p over using peak electric. The garden office is used 4 days a week. So I pay 80p a week and save £1.60 a week.

I paid £550 for the heater. If I use it 17 weeks a year, it’ll take 20 years to pay for itself…

[Countrypaul]

That seems a strange way to look at the costs, if you are only looking at how much it saves when on off peak rate compared to peak rate. Come April when electricity prices rise the time to pay back may well drop

What is the alternative, no heat, a fan heater (lower cost of heater, but would run only at peak time?), oil filled radiator, or did you have something else to compare it to?

[Stinsy]

I was comparing to using the same amount of heat during peak rate. Eg from the £20 heater that the storage heater replaced.

15p for peak is (and always was) too cheap. New customers pay 25p which is more sensible IMO (not complaining). So assuming I go on to 25p peak and 5p off-peak when my deal ends, the payback will indeed be shorter.

[Countrypaul]

Ah, with you now, the main fly in the ointment is what will the off-peak rate be, I suspect only about 10p less than peak, so might not make much difference to payback after all ! Sorry to be pessimistic

[GarethC]

I'd be interested in the carbon savings too. Peak electricity will tend to have a far higher carbon intensity than overnight off-peak.

While the financial payoff may not be fantastic, you have probably found a good way to heat with very low average emissions at least reasonably economically.

[AE-NMidlands]

Is there any reason to assume that off-peak electricity will stay as low as 5p / unit?
A

[Oliver90owner]

What are you going to use outside that 17 week period? Just charging for a couple hours means some extra savings on the occasions of cold weather outside that magical 17 week period - or does solar definitely cover that?

The increase to 25p per daytime unit will double your saving, so halve the payback - and as Paul says, leccy costs will rise…

My current daytime leccy is ~2.4 times my night rate 10.5p v 25.3p.

If you are worried about your storage heater and payback, what do you expect it might be worth in ten years time?

If really worried about costs, you should have installed a cheap gas fired heater..

Edited to add: Or even one of the £100 chinese oil-fired air heaters

[Stinsy]

While it is impossible to know for sure what will happen to off-peak electricity prices, I'm confident that the rollout of offshore wind together with HPC coming online will result in the continued availability of cheap off-peak electricity.

Remember when Agile promised: ultra-cheap, free, or even negatively-priced off-peak electricity?

A 5x difference between peak and off-peak makes everything we talk about on here (batteries/storage heaters/BEV charging/etc.) exciting and profitable. Gives that warm feeling of benefiting from working harder and planning better than other people. 3x or less is only worth it if your peak price isn't particularly high.

[nowty]

I bought my two storage heaters a few years back and I only used to use them via my solar diverter for an extra bit of heat in spring and autumn. In the winter of 2019/20 I did an experiment by boosting the heaters on the cheap rate to use less gas. I certainly used less gas, but gas was too cheap back then so it financially cost me.

Last winter gas was still cheap so I did not boost the storage heaters and my gas usage increased. This winter, because I have been dumped from my cheap gas deal (supplier went bust), my gas rate is now 4.2p, so on a par with my 5p Octopus deal. And because I now have 6 hours of cheap rate I can add even more power into the storage heaters and so far my 6kW heat pump is managing to keep the house warm and the gas boiler is still switched off.

But if the 5p cheap rate deal goes up, then I might have to go back to burning more gas to supplement the heat pump. The Ripple wind turbine will complicate matters if the 5p cheap rate goes up. Do I do the right thing and use the matched amount of leccy or take the rebate cash out and burn more gas again.

I am hoping I will do the right thing, but in the end money talks.