February 22, 2018 / 12:43 PM / 2 years ago

Britain's Octopus Energy to pay customers who use excess electricity supply

LONDON, Feb 22 (Reuters) - Britain’s Octopus Energy, a challenger to the country’s big six power utiltities, has launched the first domestic tariff to pay customers who use electricity when there is too much supply in the system, it said on Thursday.

* The move comes as energy suppliers face pressure to reduce costs for customers, with the British government planning to impose a cap on prices.

* Octopus said the tariff is a world’s first, with 100 percent of the electricity coming from renewable sources and prices adjusted half-hourly to reflect moves on the wholesale market.

* On occasions when prices drop below zero - which can happen when there is low demand and high output from wind farms and solar plants - customers would be paid use to use excess electricity.

* Customers will be sent an alert, either by text or email telling them about a “plunge pricing” event, enabling them to set timers on appliances such as washing machines or charge their electric vehicles at the appropriate time to take up the offer.

* Octopus said there were four occasions over the past 12 months when the unit price for electricity dropped below 0 pence/kilowatt-hour.

* A home-charging electric vehicle user could save as much as 669 pounds ($928.24) a year compared with the average tariff among the big six suppliers, it said.

* Britain’s big six energy suppliers, which control about 80 percent of the market, are Centrica’s British Gas, SSE , E.ON, EDF Energy, Innogy’s Npower and Iberdrola’s Scottish Power. ($1 = 0.7207 pounds) (Reporting by Susanna Twidale; Editing by David Goodman)

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