A UK power station. © 123RF
A UK power station. © 123RF

'Smart power' could save £8bn on energy bills

7 March 2016

The adoption of smart power, including the use of giant batteries to store electricity, could save consumers up to £8bn a year by 2030.

In a report the National Infrastructure Commission (NIC) said the UK could benefit from innovations in interconnection, storage and demand flexibility to make up a predicted shortfall in power supply. Two-thirds of the UK’s power stations are due to close by 2030.

The interconnection innovations suggested included importing what the NIC called “cheap, green power supplies” from countries such as Norway and Iceland.

“Government should redouble its efforts to open new connections,” the report said.

New storage technologies, which are accelerating at a remarkable speed, could also benefit the country, the report said. But to take advantage of these technologies the Department of Energy and Climate Change and Ofgem need to remove outdated regulatory and legal barriers to storage providers and provide financial incentives.

In 2014 the UK’s first two-megawatt (MW) lithium titanate battery was connected to the grid. Earlier this year AES UK & Ireland opened a 10MW battery array in Northern Ireland, the first stage in a plan to develop a 100MW storage array adjacent to Kilroot Power Station.

Increasing use of flexible demand – which helps avoid expensive “spikes” in power usage – could also contribute to the savings, the report said.

Flexible demand involves creating a network where an increasing amount of appliances are connected to a network and can be “asked” by the network if they want to take advantage of cheap electricity at times of low demand.

Such hi-tech systems allow consumers to save money and cut emissions without inconvenience.

“Government should ensure the UK’s benefits by improving regulation, informing the public of its benefits and piloting schemes on its own estate,” said the report.

A greater reliance on flexible demand could reduce the amount of nuclear and wind generation capacity needed between 2030 and 2050 by 14GW and 15GW respectively, while still meeting carbon emission reduction targets, the report added.

Lord Adonis, who chairs the NIC, said: “We do not call for new subsidies or significant public spending but rather a level playing field through fairer regulation and a better managed network to allow these exciting new technologies to compete.”

The report called for the grid operator, currently the National Grid, to conduct a more strategic and transparent approach to the procurement of ancillary services.

It also called for the transition towards more actively managed local networks to be a government priority.

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