WIREDGOV

New time-of-use tarriff offering households free power on Saturdays/Sunday paves way for further innovation in UK energy system.

British Gas has announced the UK's first major national tariff to use smart meters to offer different prices at different times of day.

The FreeTime Tariff would see households offered "free electricity" between 9am and 5pm on either Saturday or Sunday, using smart meters to monitor their usage in real-time.

Flexible time-of-use tariffs are just one of many innovative ways in which smart meters are revolutionising the future of energy in the UK. Because a smart meter can accurately measure how much electricity you're using and when you're using it, it enables suppliers to better monitor demand and pass through a more realistic interpretation of system price signals.

These new tariffs will be an essential part of managing our future national energy supply driving behavioural change amongst domestic users and decreasing pressure on the grid. The recent National Infrastructure report Smart Power found fewer new power stations will need to be built if consumers and businesses are willing to be “flexible” about when they use electricity. There are also significant cost savings for customers.

British Gas results from similar tariff trials showed average customer savings of £60 per year on their electricity bills. About half of the saving was from getting their usual Saturday or Sunday electricity usage for free, while the other half was from behavioural changes such as shifting electricity-intensive activities like laundry to "free" days.

A UK Power Networks trial in London found people were willing to change the time they used their washing machines and dishwashers based on tariffs that varied with wind power forecasts. Customers saved on average £21 per year with one household that was prepared to be particularly flexible saving £148. A similar project looking using sunshine tariffs is being trialled in Cornwall. 

As technology develops, domestic users will be able to manage their demand for electricity in response to price signals. Time-of-use tariffs will enable customers to take advantage of innovations within the connected home space, for example ensuring their appliances operate at the most cost-effective times of day by responding automatically to remote signals. Storage at the household level also becomes increasingly attractive.

Details on how the FreeTime Tariff works can be found on the British Gas website.