National Grid’s new energy scheme to prevent blackouts is delayed
National Grid has delayed the start of its “demand flexibility service” which would see some households paid for using electricity during off-peak hours.
It had been planned to start today to ease the pressure on the British energy system following warnings that there would be a fall in the amount of energy available to import from France.
The new system was launched at the start of November and it rewards those signed up if they are able to use less energy during peak hours.
If households are able to cut their electricity use, by running items like the washing machine and dishwasher in off-peak hours, they could save up to £100 off their annual energy bill.
Households are alerted 24 hours in advance to a set time period when they will need to reduce their electricity consumption. The first of these was expected today however National Grid decided not to go ahead with it as it was not required.
It said: “To manage margins on the electricity system, we are using routine tools. We are confident that these tools will allow us to manage margins and demand is not at risk.”
Fears of energy black outs
The CEO of National Grid John Pettigrew warned in October that households may face black outs this winter if energy stocks run low.
If this were to happen, gas would be cut off during the peak hours of 4pm to 7pm. However, Pettigrew said this would only be a “last case scenario”, if generators fail to secure enough gas from Europe to meet demand.
It comes as energy bills for UK households have soared in the last year, partly because of a rise in demand and an increase in wholesale prices.
Bills would have hit an average of £4,279 this January, under Ofgem’s energy price cap, if the Energy Price Guarantee had not been introduced. The guarantee has capped average bills at £2,500 until April when the cap will rise to £3,000.
Demand flexibility service
The demand flexibility service is now live and several energy providers, including British Gas and OVO have signed up.
It has been given approval by Ofgem and will be live until 31 March 2023.
Tests are being carried out to make sure the service works and that both suppliers and billpayers who have signed up to participate are rewarded.
Suppliers will alert qualifying customers about an upcoming test 24 hours in advance. They will then be asked to reduce their energy use during an hour chosen by National Grid.
Households signed up to the scheme could save approximately £100. Meanwhile, suppliers will be paid £3 per KWh saved.
It is up to energy providers to join the scheme, and then communicate with customers giving them details about how to sign up.