The Demand Flexibility Service (DFS), a scheme run by National Grid ESO, offers households in Great Britain rewards for reducing their electricity usage for short periods during winter. If electricity generation from wind and solar is low, this can minimise the need to turn on expensive fossil fuel power stations. As the amount of renewable generation on the grid is increasing, services similar to the DFS are expected to become more common in future. 

Households that can be more flexible with their electricity use will stand to benefit the most from this scheme. But this is easier for some households than others, especially for homes that use technologies such as solar panels, batteries, and electric vehicles. Factors such as having children in the home, or medical equipment could make it harder to change the times they use electricity. Therefore, how can we maximise the benefits of flexibility but avoid creating a two-tier energy system, where other households that are less able to provide it miss out?

This project focused on customers with smart prepayment meters. We believe prepayment customers may have different needs to credit customers in terms of benefitting from flexibility. They need to budget differently month-to-month, and often feel the impact of increased or decreased energy demand more quickly and directly in their disposable income. Having a prepayment meter can be used as a way to avoid or manage energy debts - which for some customers can be linked to wider issues of energy affordability.

Prepayment customers using smart meters can benefit from better real time information about the energy they are using. This also means their energy supplier may be better able to pass on rewards from the DFS, as they can prove that they have shifted or reduced their demand to help the grid.

This project improved our understanding of how households with prepayment electricity meters (of which there are around 4 million in Great Britain) view and can benefit from using electricity flexibly. We will use these findings to inform our work to design and scale services that will help a broader range of households to provide flexibility and contribute to building an affordable low-carbon energy system.

Our sustainable future mission has the ambitious goal of reducing household greenhouse gas emissions by 30% by 2030 (from 2019 levels). Meeting this goal rests largely on decarbonising electricity (mainly through renewables) and then electrifying demands like home heating through the use of heat pumps. In such a scenario, demand flexibility is expected to play an important role in keeping costs of electricity system operation (and therefore our electricity bills) down.

Part of our strategy is to show how flexibility can benefit a broad range of households, not just homeowners that can afford to buy their own low-carbon technologies. Beyond questions of fairness, ensuring that large parts of the population are not left behind is important to maintaining support for net zero. This project improved our understanding of what might need to be done to allow households with prepayment meters to benefit more from providing flexibility. 

We worked with Utilita to interview a small number of their prepayment customers about their experience of Power Payback. A mix of households were selected to take part, from those who made big savings as part of the DFS, to those who opted not to participate at all. We were interested in understanding how and why they responded to calls to reduce their electricity demand, why they chose these actions, and how pleased they were with the results. The interviews also covered people’s wider views on the growth of flexibility services like DFS in the future.