A plan to pay more than one million households and businesses to cut energy from 5pm to 6pm tonight has been branded a ‘gimmick’, with experts claiming it is a way to ‘penalise’ those without controversial smart meters.
The National Grid is activating its Demand Flexibility Service (DFS) for an hour this evening with 26 energy suppliers, such as British Gas, EDF, Eon and Octopus Energy, participating in the scheme.
Families will be paid between £10 and £20 to cut their usage to prevent blackouts on one of the coldest days of the year, amid warnings supplies will be ‘tighter than normal’.
Craig Dyke, who is in charge of the project, has refused to rule out using the ‘world-leading’ scheme every winter, saying it will ‘drive forward towards net zero’. Asked if it could become a feature of British life each winter, Mr Dyke told the BBC: ‘It’s something we strongly believe in. This is the start of something much, much bigger’.
More than one million users have signed up for the service. But critics have condemned the decision to open it to only the 29.5million homes and businesses with smart meters, which means just under half the population is ineligible. Some critics told MailOnline they are being ‘excluded’ because they can’t get a meter – complaining of waits of six months or more.
Supply chain expert Richard Bartlett said: ‘The blackout scheme just seems like another gimmick. I can’t see how it’s going to work. It’s just the Government’s way of rolling through situations without tackling the issue’. Mr Bartlett said he is worried about the number of people who may be without heating. He added: ‘The savings that it is going to amount to doesn’t seem worth the amount of work involved. I can’t see myself doing it and I can’t see many others doing it either.’
The National Grid is encouraging homeowners to take part in the scheme in a bid to avoid potential blackouts – this is how much they could save. Experts have suggested its customers could save as much as £240 this winter if there are 12 Demand Flexibility Service events called by the National Grid
Most of the UK’s energy suppliers have signed up to the Demand Flexibility Scheme that will pay families £100 to keep their electricity switched off during peak times this winter – as long as they have a smart meter
Snow-covered fields in the Brecon Beacons National Park, Wales, this morning
Households could receive payments of up to £20 if they don’t use ovens, washing machines, tumble dryers, dishwashers, games consoles or decide not to charge cars during the hour.
But the scheme relies on users having a smart meter, a device that automatically transmits your energy usage to your provider every 30 minutes.
There have been many complaints about the devices, ranging from them logging inaccurate readings that lead to inflated bills to stopping working altogether.
Wireless technology expert Nick Hunn told MailOnline: ‘If it has an impact, then expect to see a lot more events like this, as it effectively lets suppliers increase costs for users without smart meters.
‘It’s a very similar approach to what they’ve been doing by moving customers to prepay meters, i.e. penalising the ones who don’t do what the suppliers want.
‘Given the suppliers have failed dismally to meet their smart meter-fitting obligations, they may see this as a way of offsetting their penalties by blaming customers for not have signed up.
‘I suspect it would be subject to legal challenge, as in most cases, it’s not the customer’s fault that they’ve not had a smart meter fitted yet, so this is a selective discount. We’re still barely at the halfway point for compliant smart meters being installed’.
It came as energy watchdog Ofgem said it is to review the checks and balances energy firms have around placing customers on pre-payment meters, warning it will take further legal action if it finds they are not taking due care.
In a blog, its chief executive Jonathan Brearley said he is concerned about the ‘sharp growth in households struggling to pay their bills being switched over to pre-payment meters, sometimes without their even knowing about it, leaving them without heating’.
It follows Business Secretary Grant Shapps’s demand over the weekend that energy suppliers stop forcing financially-stretched households to switch to pre-payment meters. He also vowed to ‘name and shame’ the worst offenders.
Ahead of an urgent question in the Commons this afternoon, the Prime Minister’s spokesman said: ‘This is an issue of concern. He [Rishi Sunak] welcomes the fact that Ofgem have said they will look into this. You will know it is something that the Business Secretary has said that the government is keeping a close eye on and we will not hesitate in naming and shaming any suppliers that aren’t following the rules.
‘We will await Ofgem’s work but in the meantime we will be clear that providers need to be treating those who are struggling fairly and lending a sympathetic ear to those who are struggling. We want to see greater efforts from suppliers to help consumers in payment difficulties and Ofgem’s rules already make that clear.’
It is the first time National Grid has implemented the DFS since it was announced last November, as the UK prepares for freezing temperatures this week.
Craig Dyke, head of National Control at National Grid ESO, suggested the measure could become a regular part of the UK winter.
He said: ‘It is something we strongly believe in. It provides flexibility for the system and the consumer. We see this as a growing market. We see this as a world-leading step forward into a space where we can only grow and drive forward towards net zero’.
Participants in the Demand Flexibility Service will receive money off their bills if as they voluntarily reduce their usage between 5pm and 6pm.
It is the first time National Grid has implemented its DFS scheme since it was first announced last November, as the UK prepares for freezing temperatures this week.
In a further sign of the squeeze on supply, the company is preparing to use its back-up coal plants at the Drax power station in North Yorkshire and West Burton in Nottinghamshire today.
It will be the first time the two coal-fired power units are warmed up on standby, ready to generate in case they are required.
A spokesman from National Grid’s electricity system operator said: ‘Our forecasts show electricity supply margins are expected to be tighter than normal on Monday evening. We have instructed coal-fired power units to be available to increase electricity supplies should it be needed tomorrow evening.
‘This does not mean electricity supplies are at risk and people should not be worried. These are precautionary measures to maintain the buffer of spare capacity we need’.
Energy companies say smart meters are mandatory.
But the rollout of smart meters has been plagued by an industry-wide supply problem. Hundreds of thousands of households are unable to get one because they live in high-rise flats, old properties with thick walls, or remote regions with poor signal.
It comes as temperatures plunge to -8C overnight and ‘freezing fog’ will remain for much of the week.
Twenty six of the UK’s energy suppliers are taking part in the DFS scheme including British Gas, Eon, Octopus Energy and EDF.
Participating households earn around £3 for every unit (kilowatt per hour) they save by keeping their electricity switched off during peak times.
It came after National Grid put three coal-fired power plants on standby over the weekend as the UK grapples with a cold snap following a period of unseasonably mild weather earlier this month.
The UK’s power grid operator gave notification to warm the three units, owned by Yorkshire-based Drax and French generator EDF, in case they are needed to provide additional power to the grid as temperatures remain close to or below zero in much of the country.
National Grid said the move ‘should give the public confidence in Monday’s energy supply’, but stressed that the coal plants would only be used to increase the electricity supply ‘should it be needed’.
There are worries that the freezing temperatures and low levels of wind, which reduces the generation of renewable electricity, will put additional strain on the power grid this week.
The coal plants were due to close in September but have been kept open longer as potential backup while the UK grapples with a disruption to natural gas supplies following Russia’s invasion of Ukraine.
Fears Britain could face power cuts this winter started in October when National Grid warned gas shortages could lead to three-hour blackouts in some areas.
The plans were based on a worst-case scenario of the UK receiving no imports of electricity from continental Europe this winter alongside a lack of gas.
Britain depends heavily on natural gas to produce electricity, with gas-fired power stations accounting for more than 40 per cent of its electricity supplies.
But international gas markets were thrown into chaos after Russia shut off most of its supplies to Europe in retaliation for the West’s sanctions.
While the UK does not use much Russian energy, there are fears gas shortages elsewhere could affect imports, leaving the electricity grid facing a supply shortfall.
The typical overnight temperature for England in January is around 2C, but this will fall as low as -8C overnight on Monday. It in turn means the ‘freezing fog’ will take longer to clear, with warnings for motorists likely to remain in place.
A Met Office spokesman told MailOnline: ‘[Overnight], temperatures will get down to below freezing with -8C as a minimum temperature. Moving into Monday morning, the freezing fog will be slow to clear.
‘Outside of this fog, there will be sunny skies in the morning but it will remain very cold. As the day develops, sunny spells will pick up from the east, turning cloudier.
‘For northern parts and Scotland, there will be rain particularly in slopes and hilly areas.
‘Broadly speaking, Tuesday will remain very similar with temperatures again falling overnight but remaining above typical in northern areas.’
Temperatures are typically milder to the south and colder to the north of England and Scotland, but the current weather system is bucking that trend.
The Met Office adds that journey times by car and public transport are likely to be longer than usual, with surfaces likely to be more slippery than usual with a greater risk of injury.
The DFS — which is only open to those with smart meters — looks to reward homeowners for changing their electricity usage in a bid to avoid blackouts across winter.
It is among a range of tools designed to help manage the electricity system this winter.
Mr Dyke said: ‘These test results show that, if called upon, this service will help the ESO balance the national electricity network this winter.’
At the time of its launch in November last year, John Pettigrew, head of the National Grid, said that ‘a vast majority of suppliers in the UK have now signed up,’ to the scheme.
The National Grid is hoping it will mean less stress on the grid, making better use of the country’s electricity generation by ironing out some of the peaks.
Most customers tend to use electricity at similar times, with a particularly big spike in the evening when people get back from work, start cooking and switch the TV on.
‘We’re really pleased with the take-up,’ Mr Pettigrew said. ‘It will continue to grow as we move through the winter.’
National Grid runs the project, but requires suppliers to sign up so that their customers can take part.
Ofgem approved the proposals for National Grid electricity system operator (ESO) to launch the programme from November until March.
Participating households will be sent a message from their supplier if there is increased pressure on the system.
It will ask people and businesses who have signed up to reduce or move their electricity usage outside peak hours.
Mr Pettigrew said the programme could help take pressure off the grid this winter, but could also be pivotal in determining how electricity might be used by homes in the decades ahead.
In future, experts hope most households with electric cars will plug in when they get home, but that their smart meter will wait until electricity is most abundant — and therefore cheaper — on the grid before charging the car.
‘In my mind it’s a little bit of a glimpse of the future. Because, with smart meters, customers can interact and provide services to networks that they’ve not been able to do in the past,’ Mr Pettigrew said.
‘So, for me, although it’s something that’s a useful insurance policy for this winter for the system operator, it’s actually quite exciting and it’s actually developing products and services that I think will be the norm going forward.’
The National Grid reported a 45 per cent jump in pre-tax profit to £1.6 billion in the six months to the end of September last year, largely due to acquisitions the business has made.
The firm invested a record £3.9billion in capital projects across the UK and the US, as well as work on a cable that will allow Britain to tap into Danish wind power.
No one will be penalised for not taking part in the scheme, and those who sign up can still use as much electricity as they want during peak hours.