Where electricity is free on Saturdays (Could your city be next?)
By: SGN Staff
Quick Take: I've said before that the UK could be the laboratory for a brave new world of electricity, one that looks more like today's cellular market than yesterday's regulated business model. And I've said before that one of the keys to the new consumer is choice. Yes, consumers want low prices, but they also want to "have it their way."
Both trends are now in evidence in the UK, where a leading provider is offering an intriguing choice - free power on Saturdays. Is this the first leak that shows the dam is about to crumble? Could we see a transformation in electric power as dramatic and turbulent as the ones that overtook bookselling, financial services, air travel and telecommunications? - By Jesse Berst
Centrica subsidiary British Gas (which also serves electricity customers) is piloting free power on Saturdays. If successful, the pilot will be extended to the one million British Gas customers who have smart meters.
Reuters calls the idea a "Masterful piece of marketing" which illustrates "how quickly smart metering will transform the way residential customers use and pay for electricity in Britain and around the world.
Instead of discounts, many utilities have proposed raising peak power prices. Under some schemes, peak power could cost as much as 10 times as much as off-peak prices. But such pricing has seen stiff resistance in some parts of the world.
Many US utilities have turned instead to demand response "rebates" to those who volunteer to reduce their power needs during power emergencies.
Now Centrica's testing the idea of heavily discounted or even a zero-price power over weekends. Like the other plans, free weekend power encourages residential customers to shift consumption to off-peak times.
"Discounts will always be more popular than surcharges," said Reuters. "By focusing on the potential for cheaper power at weekends, Centrica aims to reframe smart metering and pricing reform as a benefit to customers rather than a restriction."
Meanwhile, the Telegraph posted an article with tips on how to cash in, such as cooking a week's worth of meals on Saturday.
Centrica has already tested heavily discounted off-peak power in deregulated regions of the United States, including Texas.
Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.