Scheme launches offering households energy bill discounts to cut usage

It comes after warnings by the energy network operator that blackouts could be needed in a worst-case scenario.

04 November 2022

Households will be able to receive discounts on energy bills if they reduce their electricity usage from peak hours on certain days, after National Grid plans were given the go-ahead by the energy regulator.

The network operator, which revealed the service as part of efforts to avoid potential blackouts, has said households could save up to £100 through the limited scheme.

Energy watchdog Ofgem has approved the proposals for National Grid electricity system operator (ESO) to launch the programme, called a demand flexibility service, from November until March.

In the coming days, the ESO will seek to run the first tests for the service, which will also be available to businesses.

There will be a total of 12 test days to see how customers respond. Only customers with smart meters will be able to take part.

Households participating through the programme will be sent a message from the network if there is increased pressure on the system.

It will ask people and businesses who have signed up to reduce or move their electricity usage outside peak hours.

It comes a month after the operator warned in its winter outlook that the first planned blackouts in decades might hit parts of the country this winter if power plants cannot get enough gas to keep running.

In what it called an “unlikely” scenario, the ESO said that households and businesses might face planned three-hour outages to ensure the grid does not collapse.

Fintan Slye, executive director of the ESO, said: “We are delighted that Ofgem have approved the use of our Demand Flexibility Service this winter.

“It will help mitigate the potential risks that the ESO has outlined in its Winter Outlook and will allow consumers to see a financial return for reducing their electricity use at peak times.

“As a responsible operator of the electricity system we have developed this innovative Demand Flexibility Service to compliment the robust set of tools we already use to balance the electricity system every day.”