National Grid to pay households to cut electricity use for second day in row

Discounts for households for cutting their electricity use at peak times will be offered again as part of a scheme to avoid winter blackouts.

The National Grid Electricity System Operator’s (ESO) Demand Flexibility Service will be offered for a second time to eligible households between 4.30pm and 6pm on Tuesday (24 January).

The Tuesday session of the Demand Flexibility Service will come just 24 hours after some households with smart meters were eligible for the reductions if they saved energy between 5pm and 6pm on Monday.

The grid operator is running the second ever live run of the scheme as coal plants were again set on standby in case electricity supplies fell too low.

In a statement on Monday afternoon, it said: “We have taken this decision as we currently see a similar operational picture to the one available on Sunday. The use of these additional services is not an indication that electricity supplies are at risk, but that we require greater options to manage the network as normal.”

It comes as recent cold weather and bad conditions for wind turbines have left the grid with less supply to meet demand than it would have liked.

There have been several test runs of the money-off scheme in the past, but Monday was the first time that the Demand Flexibility Service was used to ensure that the grid is balanced. The system is set up to ensure that no more electricity is being taken out than is being put in at any given minute.

Traditionally the grid operator tends to do this by creating extra supply, but the new system allows it to reduce the amount of electricity that is being taken out.

The scheme is administered by energy suppliers and monitored using a smart meter, so only customers with smart meters will be able to take part. Those who sign up will receive a text or other message saying that the programme will run later in the day.

If households use less electricity than they normally do during the allotted hours they will be paid for the savings. Households can still use electricity during peak hours and will not be punished if the same amount, or more, electricity is used than usual during that period.

The scheme is due to stay in place until March, with 26 energy suppliers including Octopus Energy and EDF signed up to it, but up until Monday it has only been used in tests. Households with these suppliers have to sign up in advance and opt in to the system each time.

Customers of Octopus Energy are among those who can expect higher-than-usual payouts. The supplier said that all customers who take part can expect to be handed £3.37 worth of points per unit of electricity they save, 50% higher than past payments.

Several other suppliers also bid for higher contracts than usual, meaning they could be paying their customers more to take part. Octopus said customers with a functioning smart meter could have signed up at any point before the session started at 5pm on Monday.

Separately, the ESO also said on Monday that three coal power plants had been asked to warm up in case they were needed in case supplies were tight on Tuesday.

The sites, owned by Drax and EDF, had been meant to permanently close as Britain phased out coal, but they were kept on standby this winter in a deal struck with the government amid the ongoing energy crisis. None have needed to be used as yet.

The three sites had already been warmed up on Sunday in case they were needed on Monday, but were stood down around midnight. The plants need time to slowly warm up before they can start producing electricity for homes, so the grid needs to warn them in advance.

Craig Dyke, ESO head of national control, told Sky News: “We took the decision over the weekend to warm three coal-fired power stations, just for contingency, so not necessarily to run.

“Just to ensure that as we get through the evening peak today, we can ensure society that there will be electricity for them to use when they want to use it.”