The National Grid has awarded contracts to 431 commercial sites throughout the UK, whereby the grid operator will pay businesses to switch off their electricity for several hours on week days between November and February.
A total of 12 companies have signed up to the Demand Side Balancing Reserve (DSBR) initiative, including Europe’s second largest steel producer Tata Steel.
The scheme, which was initially announced in June, will see these sites paid a retainer for the period and, if asked to switch off or reduce power, will be paid an additional sum for doing so. This will allow the National Grid to divert power to residential properties between the hours of 4pm and 8pm on weekday evenings – peak times for the country’s power network.
According to senior manager Peter Bingham, this deal with companies presents the best economic option for consumers.
In a statement, he says; “We are encouraged by this first tender round and we think that the extra security these contracts provide is good value for consumers.”
Signing up for a scheme of this nature may seem risky, especially as many companies are attempting to build up capital following several years of recession, but in fact this is not necessarily the case.
Many of Tata Steel’s plants own generators from which additional power can be sourced during shut down times and the retainer payment will be enough to offset any losses in the rare occasions that businesses must switch off – although the National Grid has as yet refused to confirm how much the deals will be worth.
National Grid was not planning on launching this initiative until next year at the earliest, but fires at E.On’s Ironbridge and SSE’s Ferrybridge power plants have caused a drop in the power supply available to the UK. In addition, precautionary checks at the Heysham and Hartlepool nuclear plants, both owned by EDF, have caused delays in their start up times.
In essence, National Grid is being forced to contend with the closure of old power plants whilst new ones are taking a long time to get “on the grid”. Despite the fact it has accelerated an emergency plan to ask providers for additional electricity in the event of a shortfall, it seems that businesses must also play a part in preserving electricity resources.
Businesses can help by switching off computers at the end of the day, installing energy efficient initiatives in commercial properties and turning off any machinery not in use. Hopefully, these steps along with the DSBR agreements will be enough to keep the lights on in Britain this winter.
Previous Post
BPF expresses concern over Office to Resi proposals
