Friday, 7 January 2011

Yes, the feed-in-tariff could shift the way we consume energy

Yesterday's post asked whether the UK could encourage a shift in energy use through the feed-in-tariff. Yes, says Mike Pepler, our UK awards manager, it could help balance out energy use.

Peak demand in the UK during the winter is between 5pm and 7pm (see pic above and the half-hourly live table here ). We need to even out energy demand throughout the day, regardless of whether or not households install renewables. At some point we could all be paying different electricity prices depending on time of day we use the energy. A tool in the feed-in-tariff to incentivise 'smart consumption' is therefore a step in the right direction.

But we have to watch out that such incentives don't deepen imbalances within society. One point I’ve heard raised by people working to tackle fuel poverty is that people in poverty can’t afford the new appliances to take advantage of electricity prices that vary according to time of day. If we moved towards time-sensitive pricing, they would miss out on the savings. Not only that, but the current feed-in-tariff is actually subsidised by all electricity consumers, but only those installing micro-renewables get the benefit.

These disadvantages don't mean we shouldn't have a feed-in-tariff. We need new generation capacity to reduce CO2 and to keep the lights on. Since that's in everybody's interest, you could say it's fair we all pay a bit to make it happen. But we must also be realistic about what solar can do. We will need other sources as well, and storage too.

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