National Grid to pay households to reduce electricity

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National Grid to pay households to reduce electricity

The cash incentive is to persuade people not to charge their electric car if demand is already high, and to wait until later on to run their washing machine, tumble dryer, or dishwasher.

The National Grid is about to announce how much it will pay per kilowatt hour for people cutting back when there is an acute shortfall in supply.

Instead of cutting off whole chunks of the country if we are short of gas, we can reward people for using less energy at times of peak demand, said Greg Jackson, CEO of Octopus.

The payback service will be available to homes with smart meters installed, as long as their supplier is taking part in the scheme. There are around 14 million households with electricity smart meters in the UK.

Octopus Energy, which ran a trial of the scheme earlier this year, said there could be 25 days over the next six months when National Grid would pay households to reduce their use.

It said that customers who managed to cut back their electricity consumption compared to their previous average electricity consumption would be rewarded with a payment, likely to be between 3 and 6 per kilowatt hour saved.

The compensation rate was likely to be set higher on days when the energy shortfall was particularly severe, the firm said.