The Department of Energy & Climate Change has awarded organisations £1.28m to help reduce peak electricity demand as part of the UK’s first ever pilot auction.
The DECC said the auction will help reduce demand by at least 1,855,548 kWh across the country during the winter peak, which is equivalent to making over 37 million cups of tea.
Energy and climate change secretary Ed Davey said: “We want to see if reducing demand on the electricity grid can be a cost-effective solution that will work alongside building new power stations – guaranteeing our energy security, cutting emissions and lowering energy bills.
“This auction is the first of its kind in Britain. If this goes well, demand reduction could compete alongside new generation in future capacity auctions, to help keep costs to consumers as low as possible.”
Association for Decentralised Energy director Dr Tim Rotheray said: “Although promising, the results from today’s first demand reduction auction show the need for the Electricity Demand Reduction scheme to be open to all energy users rather than a limited few.
“By creating the right policy, demand reduction has the potential to reduce power consumption by 45TWh by 2020, enough for thousands of cups of tea for everyone in the UK.
“It is vital that in extending this pilot it brings forward demand reduction at best value to the consumer. By creating a pilot that is more accessible to different energy users, such as industrial sites and those with Climate Change Agreements, we have the opportunity to bring forward much more reduction capacity at lower cost.”