Time of Use (TOU) tariffs and how to compare your prices with other suppliers - discussion

It does feel as if the country has invested too little in infrastructure, and that generation capacity has been allowed without a requirement to either boost the inter-connects, or require storage capacity for low generation days. . 

@Transparent Apologies if I sounds abrupt or confrontational, that is not the intention. I am not the best written communicator and the tone can be misunderstood 🙂, oh and I can ramble on!

I totally agree re the cost only principal behind the V2G business model but I feel the connection between wholesale price and CO2 though coincidental in most respect is there.
As an unintentional effect (though sold as a benefit) the Kaluza managed V2G does not charge the EV during the most expensive (and normally dirtiest) electricity, it also supports the grid during peak times by generating, therefore reducing the need to generate more electricity from dirty sources. 
 

There is no doubt that V2G, domestic PV etc  will not solve all the issues the grid faces for the future but it could assist. With increased renewables comes the problem of intermittent supply, grid scale energy storage is required in huge amounts to be able to realise net zero.  There should never be a situation where any renewable source of energy has to stop generating. I do believe more domestic generation and storage can help and should be encouraged. I don’t believe it should be a way for people to make significant amounts of money through the likes of FIT payments. The grid needs to adapt and encourage the uptake of local generation in a way that achieves net zero to be realised sooner. 
 

In my ideal world that would mean compulsory smart meters to all consumers and centralised data available for grid management. 
 

One of the biggest issues I see in the near future with mass transition to EV’s and heat pump adoption is a lack of management and control of these consumers of power. It seems that some form of standard is required rapidly to be able to reduce demand when required (not 20 competing and not compatible software platforms). 

There is currently nothing to stop anyone having a car charger installed on their own house that can consume 7+ kW whenever they feel like doing. If 40 million EV’s all plug in at 5pm while cooking dinner and boil the kettle whilst the heat pump is heating the house… you get the picture. Policy needs fixing now before it takes 20 years and is much more costly to remedy.

When net zero is achieved there will be no more spinning coal or gas plants to plug the gap in supply, instead V2G (or V2H), home battery storage etc can support domestic use at a domestic level. 

I also fee that the consumer / domestic customer market is at this stage not going to be able to dictate energy generation mix, it just doesn’t seem feasible. What is available is net zero tariffs (with some variability of how green these really are). 
Time of use tariffs are nothing new, economy 7 has been around for decades. With current smart meters half hourly consumption metering and charging is possible. The likes of Octopus Agile which is wholesale price based (and loosely cleaner / dirtier generation) encourage demand shifting and relieve the grid to some extent.  

What we can do and should do is ask for more zero carbon energy and vote with our feet if suppliers don’t play along with the demand. There are products available now that are 100% renewable (inc OVO). The industry also needs some reform and clarity regarding what is actually renewable.  The other issue is educating people that this matters and they can do something about it today. 
 

I am hopeful that discussions like this and people who care enough to be passionate about them, we will gain momentum to make change for the better. 

Just catching up on this thread - some very interesting points! 

This is one of the key learnings from this discussion for me - local renewable generation and it’s limitations based on location. 

Wind and solar is criticized by climate change deniers (or those of a similar mindset) for it’s unpredictability, due to dependencies on the weather.  But now I learn that it’s also limited by where it’s based vs where the demand is…. Surely centralised power stations are even more effected by this capacity limitation @Transparent ?

It begs the question of planning - why are these not more distributed throughout the country? I understand you can’t have a solar farm in Leicester Square, but are efforts being made to ensure renewable generation is efficiently optimised from a capacity perspective?

Hi @TerryE - two great questions!

I am completely with you… a Time Of Use tariff is an absolute necessity! It’s not just the financial flexibility which matters, but that it provides an effective mechanism for us consumers to make daily decisions which help combat Global Warming.

1: We can be absolutely certain that OVO intend to introduce a ToU tariff. This is very much the bedrock on which they have been developing the new Billing System.

It must be as frustrating for the software developers as it is for us, that the strategy is being thwarted by intermittent inconsistencies in the data retrieved from our Smart Meters. Octopus took a different approach to this, but the OVO design allows for greatly increased opportunities to incorporate devices controlled by the Flex Platform, also being developed by Kaluza.

Unsurprisingly this was one of the subjects which featured in my conversation with Stephen Fitzpatrick last month. He is giving clear instructions to the relevant Managers as to how they should proceed. The immediate result is that we now have a Tech Treehouse which I have described more fully here on the Forum.

The aim is to capitalise on the high quality fault-analysis from customers on the Forum, and discuss the symptoms directly with the Program Managers rather than via Customer Services (the official route).

@Tim_OVO was in the same conversation with Steve, and he is tasked with bringing the relevant OVO and Kaluza staff into that Tech Treehouse. The first set of fault symptoms has now been posted there ready for them.

2: The migration of SMETS1 meters to the National Smart Meter Network has been underway since August 2020. That means the SMETS2 firmware has already been downloaded into your meter.

OVO offer batches of meters to be adopted over the months. They initially moved customers on the Priority Services Register in order to ensure that their sites would be connected via DCC before the cold weather of winter set in.

I don’t know how you will be able to tell when your site has been migrated. In theory it should be a seamless operation!

@Transparent, thanks for your reply. 

My current OVO fixed price E7 electricity bill is roughly double what it would be for an equivalent Octopus ToU tariff.  My pay-back period for my £30 termination fee is much less than a month.  

Unfortunately “absolute necessity” is a statement of intent not a timescale.  It’s not worth the hassle for me to switch supplier were OVO to introduce a ToU tariff within the next 3 months, say.  Beyond that it becomes a no-brainer.

@Transparent, thanks again for your valuable response.  As an end-consumer, I had missed this OVO Kaluza aspect. 

I am retired now,  but I was the CTO for the operations division of an internal IT services provider in my later career. I spent a lot of my time interfacing to CTO and CFOs of multi-nationals, so I understand that it is really hard to develop a successful IT strategy to address a market that is responding to pivoting technical drivers.  Some like Apple, Tesla and Amazon get this balance right and follow a successful strategy leading to significant growth.  Most get this wrong and either fail or at least badly falter.

My feeling is that OVO are floundering and for me personally, it is time to switch providers. 

The tariff seems expensive @MrPuds because we’ve only been told one price-point within one time-slot.

All ToU tariffs have major drawback at the moment because they’re still trying to average-out the costs across the nation. They have an inbuilt rigidity which helps to attract customers whilst the software is still being developed.

If an Energy Supplier took the bold step of basing their ToU tariffs on the true energy costs within the customer’s geographical location, then those of us living in areas with an over-supply of renewable energy would quickly snap up a contract. Contrarywise they’d lose customers in the large (profitable) metropolitan areas…. and could therefore find their shareholders objecting!

It’s a tricky balancing act to keep enough customers on board whilst the ToU algorithms are being honed.

To be brutally honest, now is not a good time for any energy supplier to launch a ToU tariff at all. Even Octopus Agile is currently pinned to the maximum possible rate pretty much non-stop at the moment, which is wiping out any possible savings you could make from it. If it wasn’t for the caps they put in place, the prices would have skyrocketed beyond reasonable levels.

Until things return to the real normal, it’s unlikely that any other supplier including OVO would be keen to introduce a ToU deal.

Wow - this was a really good discussion over 2 years ago. Whilst things have changed in the market generally, I do think that this needs resurfacing as it is vital (in my view) to make progress in carbon reduction