Innovative Energy Consultancy Ltd
Innovative Energy Consultancy Ltd

Electricity demand reduction pilot announced

The Government announced in June that it was to open the second phase of its Electricity Demand Reduction pilot. 

This £6m scheme is intended to assess whether projects that deliver lasting electricity savings at peak times of consumption could, in the future, compete with generation, demand-side response and storage in the UK ‘s capacity market.

Companies or enterprises looking to make improvements such as replacing old light fittings for LEDs, or upgrading other forms of electrical equipment that would deliver lasting peak time savings, could be eligible to take part.

The first auction awarded £1.28m to participants overall, with a weighted average price bid of £229/kW.  Successful applicants included Network Rail, BAE Systems, Cheshire West and Chester Council and Tata Steel.  However, the vast majority of the £10m allocated to the scheme in its first phase remained unallocated. 

In this second phase of the pilot a range of rule changes have been implemented to improve accessibility to the scheme.  The minimum acceptable project size has been halved to 50kW to broaden the field of organisations that would be willing to take part.  Participants will also have more time available to install measures, with a choice of delivering the contracted savings in either November-February 2016-17 or November-February 2017-18.  There is also now to be an early payment made after installation, among other measures.

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