The UK’s first half-hourly time-of-use tariff for households has had a “significant impact” on customer behaviour, according a new report released by Octopus Energy.
The Agile tariff launched by the supplier in February provides smart meter customers with prices reflecting actual wholesale energy costs in each half-hour settlement period. This includes passing on negative prices by paying customers to consume energy when the grid is oversupplied.
Octopus Energy said the tariff is designed to “interact with the smart products of the future, shifting usage away from peak times to reduce pressure on the network and accelerate the uptake of electric vehicles”.
The report states the 28 per cent of “engaged” customers who exhibited a “statistically significant change” in their usage over peak times lowered their consumption by 28.2 per cent during these periods.
On average, they reduced their peak consumption by 15.62kWh per month – the equivalent of 11 washing machine cycles – and cut their monthly carbon emissions by 4.5kg.
The effect was even stronger among drivers of electric vehicles. The 45 per cent of engaged drivers who adjusted their behaviour slashed their peak consumption by 47 per cent.
The report also found 95 per cent of consumers paid the same or less than they would on Octopus Energy’s cheapest fixed-price deal. The supplier said the typical customer could be expected to save £45 on their annual energy bill.
Greg Jackson, chief executive of Octopus Energy, said: “It doesn’t make sense to build expensive infrastructure when there is so much opportunity to make better use of what we currently have. Tariffs like Agile will be critical to avoiding a £40 billion bill for upgrading energy infrastructure.
“As we decarbonise, shifting consumption times will enable faster uptake of electric vehicles, battery storage and intermittent renewable generation. Now that the technology is here, we need to grasp the opportunity quickly to avoid wasting billions of pounds on white elephants and delaying critical decarbonisation efforts.”
Energy and clean growth minister Claire Perry said: “This report shows consumers on this type of tariff, armed with more accurate information, can save significant amounts of money, shift their energy use and cut their carbon emissions as part of our move to a greener, cleaner economy.”