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Billions of Pounds to be Saved in Power Industry Shake Up
UK consumers could save billions of pounds thanks to major changes in the way electricity is made, used and stored, the government has said. New rules will make it easier for people to generate their own power with solar panels, store it in batteries and sell it to the National Grid. Ofgem says this means consumers could save £17bn to £40bn by 2050.
In addition, the Government is to invest £246m in battery technology that it says will play a key part in helping to power its industrial strategy. This is one of six pillars supporting the UK's industrial strategy which could help unlock markets and industries of the future.
The Government will set up a "battery institute" to award hundreds of millions of pounds to companies on the brink of major research and development breakthroughs. Greg Clarke, the business secretary, gave details of a competition for innovation in battery technology, which he says will help make the UK a world leader in battery design and manufacture.
The rapidly falling cost of battery power is expected to radically change the way Britain is able to make use of its renewable energy generation, by storing excess wind and solar for when wind speeds slip and sunshine wanes.
Separately, Ofgem is expected to outline a new approach to its charging regime for power storage devices so that batteries can play a bigger role in balancing the electricity system.
New rules will come into effect over the next year, which, for instance, will benefit a business that allows its air-conditioning to be turned down briefly to help balance a spell of peak energy demand on the National Grid. Among the first to gain from the rule changes will be people with solar panels and battery storage. At the moment they are charged tariffs when they import electricity into their home or export it back to the grid.
Thanks to improvements in digital technology, battery storage and renewables, these innovations in flexibility are already under way with millions of people across the UK generating and storing electricity. The new rules have been designed to cash in on this.
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