How does using off-peak electricity help balance the grid?

What is the electrical grid?

The electrical grid is the system that handles the distribution and balancing of electricity around the UK. It ensures that homes, businesses and buildings, such as schools and hospitals, have a reliable supply of electricity whenever they need it.

How does electrical grid distribution work?

There are two elements that affect the National Grid’s electricity distribution:

1. Demand - the amount of electricity needed to power homes and businesses.
2. Availability - how much electricity is available on the grid at the time it’s needed.

The grid will always have electricity available to distribute throughout the UK, but it has to balance its distribution between all homes and businesses throughout each day. If there are supply issues or, more likely, increased demand, this puts pressure on the system and risks electricity shortages, with the shortfall needing to be made up through imports or increased generation. This was a particular concern towards the end of 2022 when a cold winter, low levels of energy storage and the possibility of supply interruptions due to the Russia-Ukraine war heightened the possibility of UK power cuts (which ultimately didn’t come to pass).

What does balancing the grid mean?

In this context, balancing the grid means ensuring there is enough energy available to people at the times they need it. This can usually be achieved by:

• storing excess energy for future use at a high-demand time
• importing energy from Europe
• simply generating more energy to cover any shortfall.

In recent years, though, the need to balance the grid has filtered through to domestic energy tariffs and customer usage.

How does using off-peak electricity help to balance the grid?

Off-peak electricity tariffs

Historically, the bulk of electricity in homes has been used in the evenings when people come home from school and work (i.e. between 6pm and 9pm) and cook dinner, run the dishwasher, start watching television and so on. These are often referred to as “peak” hours.

However, there is now a wide range of tariffs available that allow customers to move their energy use away from those peak hours in return for lower rates than they’d pay during peak hours, therefore reducing pressure on the grid. 

There have always been tariffs that work this way - usually Economy 7 tariffs, which split rates into daytime and night-time rates, where night runs between 12am and 7am - but there are now more tariffs which work in similar ways.

This is partly as a response to the growth of the electric vehicle market, where customers need to use a lot more electricity than usual to charge their cars at home. Shifting that charging to off-peak hours reduces pressure on the grid in terms of the extra energy used, and also helps customers charge more affordably. Some EV tariffs go even further by incorporating smart charge technology, which ensures that a car is being charged at the time when electricity is cheapest.

Demand Flexibility Schemes

There are also various schemes, including Uswitch’s Reduce and Earn sessions, which reward customers for using less electricity at peak times and reducing demand on the grid. This usually happens by giving customers money back for each kWh of energy they save by reducing their usage for a set time period.