By Paul Homewood
Ofgem has given the green light to rolling out half-hourly settlement across the retail electricity market in Britain.
The change will enable a more flexible energy system in the country, with more accurate signals sent to suppliers from domestic customers throughout the day. This increased granularity will allow suppliers to offer new tariffs and products, which will be able to encourage more flexible energy use.
For example, more frequent meter readings could encourage time of use tariffs, automation, vehicle to grid solutions and battery storage.
By increasing flexibility, the energy industry can reduce the need for new and expensive infrastructure expansions to manage the increased electricity demand expected as transport and heating electrify.
As such, the change could save consumers an estimated £1.6 billion to £4.5 billion by 2045 the regulator suggested.
Far from saving consumers money, half hourly settlement will likely raise bills for most, as punitive rates are charged during periods of high demand/low supply. Hence the reduced need for extra capacity.
The OFGEM estimate of £1.6 to £4.5bn is not annual, but for the full period 2021-2045. In other words a tiny amount compared to the cost of the smart meter roll out, heading northwards of £20bn.
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April 22, 2021 at 04:21AM