Everything you need to know about the new scheme which pays £10 a day to cut energy use and avoid blackouts

7 October 2022, 11:38

By Fran Way

@journofran

Brits will be paid to use energy-guzzling appliances, like washing machines, during off-peak hours as part a new energy scheme to stop blackouts in winter.

As part of the ‘demand flexibility scheme’, households will be told by their energy supplier when to turn off their appliances and when to use them.

The full details are still yet to be revealed but this is what we know so far:

Russia’s war in Ukraine has meant that the supply of gas and electricity has become a lot more uncertain and costly.

As a result, energy regulator OFGEM warned of a ‘gas supply emergency’ with Britain facing a ‘significant risk’ of gas shortages as a result.

Industry rules mean that the power stations that have their gas cut off may have to pay huge charges for failing to deliver promised electricity supplies.

Generators are so worried about these penalties that they’re limiting the advance sales of electricity, and then in turn, bumping up the cost.

READ MORE: Liz Truss 'stops campaign' to help people save money on bills, amid serious warnings about blackouts

The National Grid Electricity System Operator (ESO) published three possible scenarios if there is not enough energy to meet the demand – the worst of which warned of planned three-hour outages for households and business to ensure the grid does not collapse.

Any forced power cuts will take place with 24 hours notice probably between the hours of 4pm to 9pm – but more likely to 7pm when the power demand peaks.

However, they expect that there will be enough energy to meet the demand this winter and that a short supply will be ‘unlikely’.

The ‘demand flexibility service’ which will be used whatever happens to make sure people get rewarded for using the scheme, will run from November to March and households will need to opt-in through their energy supplier.

People who sign up will be paid £10 a day and larger businesses will also be paid for reducing their demand – like turning off generators.

Climate Minister refuses to rule out energy rationing this winter

Once you’ve opted in, suppliers will message customers details of the time they need to minimise their electricity use for the following day and ask them to use electricity at a different time, like overnight.

The only criteria is that you need a smart meter – which the National Grid say is because the ESO will need half hourly data from the provider for the service to work.

The National Grid hopes the scheme will free up an extra 2GW, enough to power about 600,000 homes.

The service comes after a successful trial run by the National Grid and Octopus Energy earlier this year. Since then, they have been working with suppliers of all electricity to scale it up into a national service.

The next steps will be working with those suppliers in winter to understand when the availability of electric will be.