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This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Thousands of homes could be paid to reduce electricity usage

zero carbon power supply

Households will be told about the two-hour trial window by 4pm the day before it is scheduled, so they can choose in advance whether to opt-in or not

Thousands of homes could soon be paid to halve their electricity usage for a couple of hours daily when the UK’s power demand is high under a new scheme to help reduce energy bills and create a zero carbon power supply system.

From next week the trial by Octopus Energy and National Grid’s electricity system operator will offer the household supplier’s customers the chance to earn money by cutting their power use by between 40% and 60% below normal levels during a set two-hour period.

If they meet their electricity reduction targets they could earn up to 35p for every kilowatt-hour of electricity saved.

Households will be told about the two-hour trial window by 4pm the day before it is scheduled, so they can choose in advance whether to opt-in or not. Octopus Energy is poised to invite 1.4m of its customers with an installed smart meter to take part from Friday this week, and expects about 100,000 homes to sign up for the trial which runs until the end of March.

The trial could be a welcome opportunity for eligible households after the energy regulator warned that the cap on energy tariffs would soar by almost £700 from April to an average of about £2,000 a year to reflect the recent surge in global gas market prices.

Chancellor, Rishi Sunak, last week announced a programme of support as households are expected to face a 54 per cent increase on energy bills.

Addressing the Commons on February 2, Mr Sunak said the Government would be providing support in three parts.

He announced that the ‘vast majority of households’ will receive up to £350 to help towards the cost of living – a number of critics deem ‘insufficient’.

Convincing households to become more flexible about when they use electricity is also expected to be crucial in the UK’s ambition to become a net zero carbon economy by 2050, according to Isabelle Haigh, the head of National Grid’s electricity system control rooms.

This trial will provide valuable insight into how suppliers may be able to utilise domestic flexibility to help reduce stress on the system during high demand, she said, which could help lower the cost of matching the UK’s electricity supply and demand.

More details on this policy are expected to be set out by the Department for Business, Energy and Industrial Strategy this spring.

Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.