National Grid provides details of blackout-mitigating scheme, potentially saving homeowners £100

© Reuters. National Grid provides details of blackout-mitigating scheme, potentially saving homeowners £100

National Grid PLC (LSE:LON:NG.) has detailed how its ‘Demand Flexibility Service’ will work upon receiving Ofgem approval for the scheme, which is part of its bid to avoid speculated blackouts this winter.

National Grid ESO hopes the scheme will offset electricity demand from peak times, reducing the need for potential blackouts, which it has warned could be needed in the worst cases of energy supply issues in the coming months.

It is expected typical households could save up to £100 by participating, with individual suppliers deciding exactly how customers can claim or save their money.

Industrial and commercial businesses with larger energy usage could save multiples of this, National Grid ESO said.

Those taking part will be warned 24 hours in advance of a test day, of which an initial 12 are planned between November to March 2023, and will be told to reduce peak-time electricity use during a one-hour slot, likely between 16:00-19:00.

For each megawatt-hour not used during tests, National Grid will pay participating suppliers £3,000 for distribution to consumers, including Octopus energy which has already announced its involvement.

Fintan Slye, National Grid ESO CEO, 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.”

Jake Rigg, National Grid ESO corporate affairs director, said: "It's not a big thing or a difficult thing to do, just remembering to do it 12 times this winter and get that money back, when we are all really struggling with energy bills and the cost of living generally."

However, not everyone will be able to access the scheme, with less than half, or 14mln, of UK households having required smart meters installed to take part.

Previously, National Grid has warned of three-hour power cuts if the UK faces supply shortages this winter, with the government having reportedly tested plans for the event of a week-long worst-case scenario outage.

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