Smart meter rollout ‘builds momentum’ for time-of-use tariffs

Momentum is starting to build around time-of-use tariffs, according to research from the government’s official smart meter campaign.

A survey conducted by Smart Energy GB found that 90 per cent of respondents who are not on a time of use tariff or have not heard of them say they would find one more appealing if they led to reduced energy bills.

Time-of-use tariffs allow customers to use energy at cheaper times of day. While they are not a new phenomenon, Smart Energy GB says the smart meter rollout means “momentum is beginning to build around this new pricing structure”.

The survey found that although consumers expressed an interest in time-of-use tariffs they would prefer cheaper energy at weekends or during the day on weekdays as opposed to cheaper energy overnight.

Furthermore those who are employed full-time are more likely to want cheaper energy on weekends and those not in full-time employment are more likely to want cheaper energy during the day on weekdays.

Additionally 69 per cent of respondents who were not on or had not heard of the tariffs said they would find them more appealing if they were better for the environment.

Robert Cheesewright, director of corporate affairs at Smart Energy GB, said: “As this research shows, smart meters will play a vital part in enabling households to use renewable energy and electric vehicles to make a real contribution to a more sustainable environment.

“Not only that, but they also have unrivalled potential to reward people with lower bills for doing their bit to save the planet, leaving them with more cash in their pocket to spend on the things they want.”

A number of suppliers have launched time-of-use tariffs in recent months.

Octopus Energy launched its Agile tariff in March last year and research conducted by the company found it had a “significant impact” on customer behaviour.

The tariff  provides smart meter customers with prices reflecting actual wholesale energy costs in each half-hour settlement period. This includes passing on negative prices by paying customers to consume energy when the grid is oversupplied.

Octopus said the tariff is designed to “interact with the smart products of the future, shifting usage away from peak times to reduce pressure on the network and accelerate the uptake of electric vehicles”.

Big six provider British Gas meanwhile launched a green smart time-of-use tariff for electric vehicle (EV) users in November 2018.

The Green Drive November 2020 dual fuel tariff is the first of the company’s suite of EV propositions for residential and business customers.

It will offer cheaper electricity at night between 12.30am and 7.30am in order for customers to charge their car.