Converting our heating and transport energy to electricity increases demand which puts strain on the grid. However, it is primarily the peak demand that is the problem, so shifting demand away from the peak times helps a lot. When demand is high, wholesale prices and carbon emissions are usually also high, because we need to use less efficient power sources to top up supply. However there are other factors that affect prices and emissions.
It is possible to take advantage of these differences by switching to an electricity tariff that offers higher prices at peak times and lower prices at times of low demand. In this post I compare two: Tide from Green Energy, which has three tariff levels through the day and Agile from Octopus which follows wholesale prices directly (at least for now). I look at both price differences and the carbon savings from shifting your demand away from peak times to the cheapest times. Shifting demand is easiest with a battery.
For this post I am using data from 2019 because 2020 is heavily distorted due to reduced energy demand during the pandemic. This chart shows prices in a sample week in February.
The Agile prices were from 2019. Octopus relates these to the wholesale prices: The agile formula sets the price at 2.2 times the wholesale price plus an extra 12p in peak times (16:00-19:00 each day), with an overall cap of 35p. Tide prices are as quoted to me today. They are cheap up to 7am in the morning and expensive during peak times. However their peak times are a bit different from Agile - they are 16:00 to 20:00 on weekdays only.
The agile prices vary a lot depending on the weather and other factors. This chart shows an average daily profile in three sample months in 2019. The pink section shows the peak time for Agile.
I believe the huge peak time premium is related to the fact that utility companies are charged for use of the transmission and distribution network mainly according to peak time consumption. So use at this time costs Octopus and Green Energy extra. On the other hand, prices can go negative. This only happened on one day in 2019 but happened quite often in 2020, when national demand was lower.
How does this relate to carbon intensity? The carbon intensity varies with overall demand and also with availability of renewables especially wind. This chart shows carbon intensity instead of prices, averaged over the same three months in 2019.
The peak time has high carbon intensity in February but less so in June. There are several reasons for this. Demand peaks are less pronounced and later in summer. Also in summer there is more renewable solar energy in the late afternoon in summer, and less wind overnight (because it is generally less windy in summer).
The Tide tariff is different at weekdays and weekends. These charts show the carbon by month as above with weekdays and then weekends. The red and green show high rate and low rate times with Tide.
On weekdays, there is a pronounced morning peak just at the end of the cheap time.
On weekends, the morning peak is much flatter. The evening is not charged at peak rate although there is an evening peak in intensity, especially in winter. However, this peak is lower than during the week.
So what does this mean for carbon savings, if you shift demand from peak to cheap times? For the Agile tariff scenario, I assume you shift demand from peak to some time during the cheapest 4 hours of the day. I assume you are doing it with a battery, with a round trip efficiency of 90% so you need more than 1kWh charging to supply 1 kWh during the peak. The carbon savings (and the price savings) vary from day to day and substantially during the year. This chart shows month averages, carbon savings per kWh shifted.
Carbon savings are much higher in the winter: the highest is 52gCO2e/kWh in January. However, savings are actually negative in high summer, meaning that the cheapest times have higher emissions than the peak periods. This is not so surprising when you look back at the third chart, showing carbon intensities through the day in sample months. In June, the carbon intensity during the early hours of the morning averages higher than during the day - at least it did in 2019.
This chart shows the bill savings, again from shifting demand from the peak time to the cheapest four hours of the day, per kWh shifted, with 90% efficiency. The highest savings are 20p/kWh in December but they are pretty high all the year. The average is 17.5pkWh.
For Tide, the scenario is slightly different. The shifting is from peak times on weekdays, or daytimes on weekends (when there is no peak time), to the low rate time, which is midnight to 7am on all days.
Once again, the carbon savings are high during the winter and negative in summer. The highest savings are 59 gCO2/kWh in January. For Tide, there is no seasonal difference in bill savings as the prices do not vary during the year. The average bill savings for shifted energy (averaged over weekdays and weekends) is 19.5p/kWh
In summary:
TOU tariffs offer cheaper rates for your electricity at most times of the day but with a peak time premium. If you can shift your demand away from peak times (for example with a battery) you can make large savings. Based on current rates for Green Energy Tide, and rates for Octopus's Agile from 2019, the bill savings average slightly higher with Tide than Agile, or at least they would have been in 2019. For varying tariffs like Agile that are based on wholesale price, these savings are highly variable and larger in winter and summer but still large all year round.
However, from the point of view of carbon savings, load shifting in the summer is not good news - in fact in the high summer months this can increase carbon emissions, for both Agile and Tide.
On the other hand, if you have solar panels to go with your battery then you can use your own solar power to charge it and this means you can guarantee carbon savings all year.
Data sources
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