Alison Hammond discusses potential blackouts
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The UK’s largest energy suppliers are now set to help the National Grid prevent planned power cuts this winter, by rolling out a new scheme that will incentivise households to reduce their power use at certain hours of the day. As Russia’s invasion of Ukraine has sent European energy security into chaos over the past year, the National Grid has warned that this winter, it may be forced to impose planned three-hour-long blackouts, if it fails to secure enough gas and electricity supplies. In order to prevent such a scenario from taking place, the National Grid announced a new “demand flexibility scheme” that will offer discounts to customers who slash their electricity usage at peak times.
Peak hours refer to times of the day where electricity use is at its highest. Typically this is around 4pm to 7pm, when people come home from work and school.
During these times, the National Grid needs to secure enormous amounts of power, which means it has to rely on a lot of natural gas to generate electricity, or import it from overseas.
With the supply of both in jeopardy, Ofgem has given a green light to this National Grid scheme, as it partners with some of the UK’s largest energy suppliers, as households could now save around £100 on their bills this winter if they reduce energy usage at peak times.
British Gas, Octopus Energy and E.ON confirmed to Express.co.uk they were participating in this scheme. Meanwhile, SSE announced they would run a trial of this service.
An E.ON spokesperson told Express.co.uk: “E.ON Next is taking part in the National Grid’s Demand Flexibility Service to help our customers lower their energy costs by reducing their energy consumption.
“We’re asking eligible customers to sign up so that they can join in and save when the Grid sets Demand Flexibility events. The future of energy involves every customer – at home and in business – having their own smart, sustainable and personalised energy solutions that support their everyday lives.
“Time of use tariffs can be used alongside low carbon technologies such as solar panels, EV charge points and heat pumps to ensure we can move to net-zero at a lower cost by reducing the need for ever more upstream generation and reinforcement of our networks.”
Meanwhile, a British Gas spokesperson said: “By encouraging consumers to reduce their usage at peak times we can balance demand on the grid whilst helping consumers save on their energy bills.
“We are working on how this scheme can work best for our customers and fit in with their habits around the home. We will be running a trial first to learn from before using our scale to roll out to our wider customer base.”
The National Grid estimates that with enough participation, this scheme would free up a further 2 GW of electricity, which is enough to power about 600,000 homes in the UK.
In a statement, Greg Jackson, CEO of Octopus Energy Group, commented: “Let’s be very clear: this is a historic moment – we’re entering a new era of energy in which households are moving from passive offtakers to active enablers of a smarter, greener and cheaper grid.
“Instead of cutting off whole chunks of the country if we are short of gas, we can reward people for using less energy at times of peak demand.
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“We were the first energy supplier to offer this service to our customers, and we hope others will follow our lead. By doing so, we can make blackouts a thing of the past, and bring costs down for everyone.”
The National Grid ESO said that they would have an initial test phase of the service this winter, lasting until March, and would be available to the 14 million households in the UK that have smart electricity meters.
Under this scheme, consumers will be given a 24 hour notice to shift their power usage from a peak period, and ask use to their power-hungry appliance like dryers and washing machines at other times.
Meanwhile, Raman Bhatia, CEO of OVO, said: “We’re heading into a critical moment for the UK energy sector, and we need a resilient grid to support households through this winter.
“It’s testament to our customers’ willingness to support new trials and engage with their usage that we’ve surpassed the target of trialists. We hope the results of this trial will give customers a deeper insight into how they can support the wider system, with potential savings to help over winter.”
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