Experts are recommending varying energy prices throughout the day. Is this a genius way to cut our bills and help the environment – or is it unfair on those who can’t pick and choose when to do their washing?
How would you feel about your energy company remotely switching off your freezer for half an hour a day? Before you start panicking about losing all your food in a pool of water, hear me out.
This is just one suggestion that has come about from a report by The UK Committee on Climate Change (CCC), which is recommending a new system that charges varying energy prices throughout the day.
What are time-of-use tariffs?
You might have heard of ‘economy 7’ – the current system that gives customers with a special meter a cheaper tariff late at night. If CCC gets its way, new time-of-use tariffs could be introduced from 2014, potentially meaning even more prices at different times of day.
The scheme would rely on smart meters being installed, letting your utility company to see minute-by-minute information about your energy consumption. It would also mean that, with your agreement, they could remotely switch off appliances such as water heaters or freezers for short periods to manage demand. (Which, incidentally, is perfectly safe.)
This all sounds great in theory, doesn’t it. Switch things off to save money and use energy-heavy appliances, like dishwashers and washing machines, when it’s cheapest. Lower bills, less demand on the grid.
Sort our current tariffs out first
But hang on. I’m already confused about energy tariffs – and so are many others, according to Ofgem. Their research shows that 70% of people find the number of energy tariffs available confusing, and more than 50% find it too difficult to work out whether they would make any saving if they switched supplier. And when you consider that the average household has 89 different tariffs available to choose from, this is hardly surprising.
‘Before we see a proliferation of these time-of-use tariffs, we need to sort out the tariff confusion that exists already – we’d like to see Ofgem introducing minimum standards for tariffs,’ says Fiona Cochrane, Energy Policy Team Leader here at Which?
But that’s not all, she says, adding that we won’t all necessarily save under this scheme. ‘Time-of-use tariffs could be beneficial for those who can shift when and how they use their energy,’ she explains. ‘But there are a lot of households that won’t be able to do this, and we don’t want to see them penalised because of this.’
This is a good point, and one that probably applies to me, being a full-time worker who can’t pick and choose when to use energy. Should I have to pay more because I’m not around at the ‘cheapest’ times or is there a fairer way? Ideas like remotely switching off appliances will help keep costs down, but there needs to be more of these ideas for time-of-use tariffs to be worthwhile on a wider scale.
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