Home Business News Energy experts welcome new demand flexibility service

Energy experts welcome new demand flexibility service

by LLB Finance Reporter
8th Nov 23 8:01 am

Energy and sustainability consultancy Advantage Utilities has today urged businesses to register their interest with a view to participating in the Ofgem approved Demand Flexibility Service.

This involves reducing energy consumption during designated and pre-determined windows likely to coincide with periods of high demand and/or low generation.

The Electricity System Operator’s (ESO) Demand Flexibility Service has been approved by Ofgem, meaning businesses receive financial incentives to reduce energy consumption. Last winter, over 1.6 million households and businesses participated in the scheme, supporting the National Grid to balance demand during peak times.

For winter 2023, businesses can earn in excess of £2 per kWh as a demand reduction incentive offered by the National Grid’s ESO during the scheme’s 12 test periods between November and March 2024. This reduces the likelihood of power cuts during the winter period and is an opportunity for companies to earn tangible revenue while reducing their consumption.

Tim Ross, Commercial Director at Advantage Utilities, said, “We are thrilled that our commercial clients will once again be able to benefit from this scheme and I’m sure households up and down the country will be equally delighted.

“The financial incentive available will doubtless be universally welcomed and will help offset bills during these economically challenging times. Our Dial Down Energy Scheme is a win-win situation for businesses, allowing them to make use of the Demand Flexibility Service.

“Essentially, the National Grid would rather pay consumers to dial down their energy consumption than incur the expensive costs of firing up further generational assets.

“Furthermore, and perhaps even more importantly, the scheme will also help to mitigate any lingering risk of blackouts and provide further momentum to the all-important narrative around consumption awareness and the wider carbon reduction agenda.”

Businesses can take advantage of the scheme by reaching out to registered suppliers. Last winter, £11 million was paid to participants of the scheme.

Ross added, “Businesses across all sectors are crying out for any help they can get at the moment in terms of cost savings, and energy is still in most cases one of the top three business costs, even despite recent wholesale price drops.

“With inflation still high across the board, the return of this scheme provides businesses with another way to address all aspects of their energy usage to mitigate costs as far as possible – after all, the cheapest unit of energy is the one you don’t use.”

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