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First British trial of day-ahead electricity prices

A unique trial is under way to test if day-ahead electricity price alerts can make better use of wind power on blustery days.
From press releases - 12 February 2013 09:00 AM

A unique trial is under way to test if day-ahead electricity price alerts can make better use of wind power on blustery days.

They could also help manage electricity network constraints and enable customers to benefit from lower prices.

UK Power Networks, EDF Energy and Imperial College London are researching whether sending customers day-ahead electricity prices could produce some flexibility in demand to allow more intermittent renewables in the energy mix in future. It could also reduce stress on the electricity network when it is constrained by a fault or maintenance.

The energy companies have teamed up with Imperial College London as part of the Low Carbon London programme (LCL), funded by Ofgem’s Low Carbon Networks Fund, to recruit customers for this dynamic pricing trial, which has just got under way.

More than 1,100 EDF Energy customers with smart meters are participating in the pioneering research simulation across London. Participants will receive dynamic, day-ahead electricity prices via text or a small in-home display linked to their smart meter.

Imperial College London will analyse the results of the trial and publish reports on the findings next year. The aim of the trial is to find out if households are prepared to do their washing, baking and other electricity-intensive tasks when green electricity is plentiful and cheap.

Professor Goran Strbac, from the Department of Electrical and Electronic Engineering, says: “Imperial played a major role in designing this novel dynamic tariff. It is crucial that we understand the role that residential consumers can play in the development of smarter electricity systems that will facilitate cost-effective evolution to a low carbon future.”

Niels Roberts, Smart Metering Programme Director at EDF Energy, said: “As the biggest producer of low carbon electricity in the UK, we are keen to see how the wind twinning approach could benefit both the supply network and consumers. Sustainability is at the core of our business and we are excited to be at the forefront of such research.”

Liam O’Sullivan, Low Carbon London programme director at UK Power Networks, said:  “This ground-breaking research will test whether day-ahead pricing can influence demand, manage the network more efficiently and encourage greater use of low carbon electricity.

“We think this is the first time such research has been undertaken in Britain and we will work closely with Imperial College London, EDF Energy and its customers to explore the potential impact of a flexible pricing regime. We want to see whether people can move their demand patterns away from peak times to support the most efficient, low carbon operation of the infrastructure which brings power to their door.”

The dynamic pricing trial simulation will explore how different prices at different times could encourage consumers to make more use of low carbon energy from wind farms.

Alternatively, on rare occasions when the local network has to be reconfigured and, as a result, its capacity is temporarily reduced, trial customers might receive a higher price signal encouraging them to reduce demand at certain times over the following day. This approach would support electricity distributors in managing constraints that affect the electricity network, such as faults, or reduce pressure on the network during essential maintenance. Customers might be encouraged to delay non-essential tasks until the price falls. Overall, customers who are able to respond to price signals in this way should benefit through reduced charges.

The customers will receive 24-hours’ notice of the price change, via their smart meter and mobile.

Across London, EDF Energy has installed approximately 6,000 smart meters in homes and businesses as part of the Low Carbon London programme. The dynamic pricing trial simulation is continuing until the end of the year.

Ends

For further information please contact Niamh Arnett, in the UK Power Networks press office, on 0845 302 7292.

Notes to editors: 
1. UK Power Networks distributes power to a third of Britain’s population through its electricity networks serving London, the South East and the East of England. The company was named Utility of the Year 2012 and also won the Team of the Year award in the prestigious Utility Industry Achievement Awards.
The company's 5,000 employees are dedicated to delivering a safe, secure electricity supply to about eight million homes and businesses via its networks of substations, overhead lines and underground cables. 
UK Power Networks distributed the electricity at many venues for last year’s international sporting events. This year we are investing £360million in our electricity networks and around £1.8billion in the five years to 2015. We are also undertaking trials to ensure our electricity networks support the transition to a low carbon future.
Customers pay their bills to supply companies but UK Power Networks delivers the power across our three areas. The industry regulator Ofgem sets an allowed revenue to distribution companies so that they can maintain safe and reliable electricity supplies. If customers are unfortunate enough to be affected by a power cut or have another issue with the electricity supply to their property, they should contact UK Power Networks. 
www.ukpowernetworks.co.uk 
2. Low Carbon London, led by UK Power Networks, is a £30million pioneering learning programme funded by customers through Ofgem’s Low Carbon Networks Fund and the electricity network operator. Its aim is to use London as a test bed to develop a smarter electricity network that can manage the demands of a low carbon economy and deliver reliable, sustainable low carbon electricity to businesses, residents and communities. The programme will explore how to combine new technology and commercial innovation – such as localised generation, electric vehicles, heat pumps, smart meters, dynamic time of use tariffs and responsive demand services – to support a low carbon energy economy. UK Power Networks’ partners on the Low Carbon London programme are Siemens, Logica, EDF Energy, Greater London Authority, Transport for London, National Grid, Institute for Sustainability, Flexitricity, EnerNOC, Smarter Grid Solutions and Imperial College London. More information on Ofgem’s Low Carbon Networks Fund is available here:http://www.ofgem.gov.uk/Networks/ElecDist/lcnf/Pages/lcnf.aspx
3. EDF Energy is one of the UK’s largest energy companies and the largest producer of low-carbon electricity, producing around one-sixth of the nation's electricity from its nuclear power stations, wind farms, coal and gas power stations and combined heat and power plants. The company supplies gas and electricity to more than 5.5 million business and residential customer accounts and is the biggest supplier of electricity by volume in Great Britain.
EDF Energy’s safe and secure operation of its eight existing nuclear power stations at sites across the country makes it the UK’s largest generator of low carbon electricity. EDF Energy is also leading the UK's nuclear renaissance and has published plans to build four new nuclear plants, subject to the right investment framework. These new plants could generate enough low carbon electricity for about 40% of Britain’s homes. They would make an important contribution to the UK’s future needs for clean, secure and affordable energy. The project is already creating business and job opportunities for British companies and workers.
Through Our Sustainability Commitments, EDF Energy has launched one of the biggest environmental and social programmes of any British energy company. In the 2012 Business in the Community Awards for Excellence EDF Energy won the awards for Environmental Leadership and Building Stronger Communities. In addition the company received eight BITC “Big Tick” awards in recognition of responsible business practice and was shortlisted for Responsible Business of the Year. 
EDF was the official electricity supplier and an official partner of the London 2012 Olympic and Paralympic Games. The company is also helping its customers and others use energy more sustainably through products and initiatives such as Team Green Britain, real time energy monitoring and electric vehicle research.
EDF Energy is part of EDF Group, one of Europe’s largest power companies. The company employs around 15,000 people at locations across the UK.
For more news from EDF Energy please see www.edfenergy.com/media-centre/. To find out more about the UK's energy challenges look at www.edfenergy.com/energyfuture/