Get paid to cut your energy usage: Is the Demand Flexibility Service here to stay?
- The National Grid launched the DFS last winter to cut demand in peak hours
- It has been renewed this winter and could help save customers on their bills
- Growing demand suggests it could be a more permanent fixture
Households will once again be able to earn money for cutting their energy usage in peak times, as the Demand Flexibility Service (DFS) is relaunched.
The DFS is run by the National Grid and was launched last year to avoid electricity shortages by encouraging households to use energy outside the peak hours of 4pm-7pm.
There's been healthy take-up of the scheme across suppliers as energy bills remain at a high and households try to cut their bills further.
Given the success of the DFS and even higher take-up this year, could it be here to stay in the long-term?
![The DFS was launched last winter to ease demand on the grid in peak hours](https://i.dailymail.co.uk/1s/2023/11/10/16/77561681-12725689-The_DFS_was_launched_last_winter_to_ease_demand_on_the_grid_in_p-a-1_1699632483852.jpg)
The DFS was launched last winter to ease demand on the grid in peak hours
How does the Demand Flexibility Service work?
The Demand Flexibility Service was developed to encourage customers to cut their usage and give National Grid a bit more leeway at times of high demand.
The idea is that if electricity demand is lowered, it means the National Grid doesn't have to rely on generators using fossil fuel, which is both expensive and polluting.
Over 1.6million households and businesses participated in the scheme last winter, which has been renewed this year.
Any household with a smart meter can sign up, provided their supplier is signed up to the scheme.
Most large names like British Gas and Octopus are signed up, and you can see the full list of providers here.
Most suppliers will contact signed-up households ahead of a planned window of low energy use, so customers who do cut their usage in that window are rewarded in the form of money off their bills.
The National Grid decides when to active the DFS, and plans to run 12 tests between now and March 2024.
British Gas has signed up to the DFS scheme and is also offering half-price electricity on Sundays to its customers.
Read here for more details about British Gas' half-price Sundays scheme, which runs until New Year's Eve.
How much can you save on your energy bills?
Cutting how much energy usage will always help you save on your bills, but many households have already cut their energy use to the bare minimum.
Paying customers to shift their usage and help them with their bills is a win-win for the grid and customers.
Customers can make some significant savings if they avoid using appliances that use a lot of energy between 4pm and 7pm.
EDF said that customers could earn up to £100 credit on their account by signing up to its scheme.
It said showering outside peak times could earn between £5.74 and £7.88, while waiting to turn the washing machine on could earn between £3 and £7.20.
Octopus Energy said the top 5 per cent of customers made an average savings of over £41 last year, and 7 per cent of customers who took part made enough to cover an average household's daily electricity cost.
Similarly, British Gas said its customers saved an average of £30 while its PeakSave Sundays scheme could save customers £29.95 over 14 Sundays.
Is the Demand Flexibility Service here to stay?
For households who have already cut usage, getting paid to shift usage out of peak hours is appealing and demand is only growing.
Octopus Energy said it had accounted for nearly 50 per cent of the demand shift last year, signing up 700,000 customers to its 'Savings Sessions'.
British Gas currently has 250,000 signed up to its PeakSave scheme this winter, up from 200,000 last year, while EDF has signed up 76,000 households, up from 35,000 last year.
The rise in demand this year signals a shift in habits and partly a response to elevated energy bills.
Although, the wholesale price of energy has come down since last year, the lack of government support means some households will pay more this winter.
With energy prices set to rise even further in January, according to Cornwall Insight, households who hadn't previously considered signing up to the DFS might reconsider.
Whether or not it's here to stay isn't solely dependent on customer numbers though, rather how effective it's been.
The good news is that last year, the DFS reportedly saved 3,300 MWh of electricity during peak times.
Octopus Energy in particular thinks the DFS has been very successful having shifted 1.86GWh of electricity last winter, across 13 windows
Alex Scoch, head of flexibility at Octopus said: 'Last winter we proved that households can play a huge part in balancing the grid, helping us move away from fossil fuels, and earning customers cash while they're at it.
'We have passed the point of needing to pay expensive coal plants when we can just pay customers instead.'
Demand for a shift away from reliance on fossil fuels is only likely to increase the number of suppliers using the DFS, and it could start to play a more permanent role in the coming years.
Ben Gallizzi, energy expert at Uswitch.com, said: 'The change in mindset has been so dramatic that Ofgem has reduced its figures for average consumption in the most recent price cap calculations.
'The success of the first year means that the scheme is likely to keep returning, and it could start to play an increased role in managing the stresses on the grid at peak times.'