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British Gas, the UK energy utility that is controlled by its parent company Centrica, has just announced that it plans to introduce a new tariff system that will offer its clients who have installed smart meters, the ability to receive free electricity on Saturdays.
The plan is one that is already employed in parts of the US, where customers benefit from 24 hours of free electricity on Saturdays in an attempt to encourage higher electricity usage during the weekends, rather than at peak times during the week. In order to cover the cost of the free electricity, and further encourage less energy usage during the week, rates are higher than normal from Monday to Friday.
Sam Laidlaw, the chief executive officer of Centrica, explained that the tariff not only helps to reduce consumer energy bills, but has also proven to cut CO2 emissions by reducing the need to fire up extra power plants to cover high demand during the week.
In an interview he told the Financial Times that “in addition to being good for customers, the free power days are good for carbon reduction by reducing peak power generation that is disproportionately higher in carbon dioxide emissions.”
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British Gas will begin a pilot test of the tariff system later this year, with a plan to implement the scheme on a wide scale next year based on its success. They have already begun to test smart metres and new tariffs that charge different rates at different times of the day, and a spokeswoman for the company told businessGreen, “we are building on these learnings with the intention of launching a time of use tariff early next year. To be eligible, customers will need a smart meter and we have already installed 600,000 of these in homes across the country. This is still at an early stage and more information will be provided in due course.”
British Gas is one of the first utilities to introduce smart metres to the UK, ahead of the £12 billion government backed scheme that will begin in 2015 and which looks to install 53 million smart metres across the country by 2020.
British Gas has begun to install the most advanced smart metres into customer’s homes. (British Gas)
As well as hoping that the smart metres will allow homeowners to cut their energy bills and better manage their electricity consumption, the government also believes that utilities could save as much as £19 billion in operational costs; by reading metres remotely for example.
By. James Burgess of Oilprice.com
James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also…