KUALA LUMPUR (Aug 29): Smart tariffs, which help consumers identify the best timing to consume electricity, is emerging as a practical tool to better match electricity demand and supply, said Octopus Energy CEO Greg Jackson.
With the utilisation of smart meters and artificial intelligence, smart tariffs prompt consumers to get the best electricity prices by adjusting their activities based on energy availability, Jackson said during a plenary session at The Energy Transition Conference 2023 here.
The UK-based pure renewable energy producer and electricity retailer has launched one such mechanism in 2022, targeting automatic electric vehicle (EV) charging during off-peak periods to help consumers save on bills and reduce stress on the grid and electricity supply.
The company, which manages up to 3.3GW of global renewable energy (RE) capacity across 240 projects, also commercialised another mechanism that allows participating consumers to use as much electricity as they like for free in the few hours of a day when RE mix from solar or wind exceeds demand.
“Where more than 30 companies have failed [and were unable to sustain new ideas], this particular one worked. People are adjusting their activities based on energy availability driven by price,” Jackson said.
According to Octopus Energy, the UK in 2022 spent £215 million (RM1.26 billion) to turn off wind farms, and over £715 million to turn on gas power plants to balance the grid.
The mechanism could also be rolled out beyond liberalised markets such as the one in the UK, said Jackson.
“New ideas are required, including in regulated markets. Regulators, too, want the cheapest electricity [to be dispatched],” he added.
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