Yesterday Octopus offered me free energy between 1pm and 2pm. There was expected to be too much wind energy on the grid, and they were looking for ways to offload it. This is the mirror image of the scheme that is run during the winter to reduce demand.
The small print is that only energy I used above my average demand was free. On a regular Thursday afternoon, I’m using about 0.5 kWh, so only the demand beyond this point was free.
I did nothing.
The washing had been done, the car was already charged, there was plenty of hot water in the tank. For 67p worth of free energy, it wasn’t worth it. In the winter scheme, I have been saving tens of pounds.
It’s also not just about the money. Being asked to shift your demand is a different prospect to being asked to ‘create’ demand when you don’t really need to.
In Germany last year, there were over 300 hours where wholesale energy prices were below zero. This negative pricing has become a reality of renewables saturated energy systems around the world.
Yet, the investment in the renewables that we need assumes positive energy prices and relies on properly behaving markets. As the world moves towards interconnected systems, the presence of negative prices in one market can also have perverse effects in neighbouring countries’ markets. Regulators are trying to design market models that prevent this negative pricing.
In the summer, when supply exceeds demand we can store energy (but we don’t have enough) or pay generators to turn off (expensive and wasteful). So, we’ll need industry and consumers to alter their demand.
Last winter, I did so happily but yesterday, the incentives weren’t there. Perhaps this shows the promise and hurdles of demand side response.
