Post - Blog
Shining a light on energy efficiency
- 2 months ago (2024-10-18)
- Junior Isles
Ian Sykes , Energy, Utilities, and Commodities Client Principal at BJSS .
E-World 2025
The UK’s energy landscape is on the brink of significant transformation, with Britain’s new Labour government committed to a clean energy transition and lower energy bills, as specified in the King’s Speech 2024 . With an ambitious plan to accelerate the UK’s net zero strategy, the government is prioritising the increase of renewably sourced energy production. However, this shift is not without its challenges.
Integrating additional renewable energy sources, including wind, solar, bioenergy, and hydropower, into the national grid will require significant infrastructural upgrades. Estimates suggest that investments amounting to tens of billions will be needed. As such, technological solutions will be necessary for ensuring the grid remains robust and reliable as it adapts to these new energy inputs.
Data to drive household savings
As the UK navigates the complexities, and associated cost, of distributed energy generation (when electricity is produced from local sources, rather than from large, centralised power plants) it must also contend with the ongoing volatility of the energy market, compounded by the cost-of-living crisis. Although gas and electricity prices are beginning to decline after a period of significant increases since 2022, the price cap will rise by 10% to £1717 in the fourth quarter of 2024 and is expected to increase by a further 3% in the first quarter of 2025. This represents a 45% increase compared to Winter 2021. For many households, energy costs remain a significant financial burden.
One of the key issues is that a large proportion of UK customers are currently on Non-Half-Hourly (NHH) tariffs. These tariffs, typically based on monthly or quarterly estimates, often fail to reflect real-time energy usage, leading to imprecise billing. This lack of accuracy can result in customers paying more than necessary. The introduction of smart meters, equipped with Internet of Things (IoT) capabilities, offers a solution. These meters can communicate directly with home energy management systems, tracking and recording energy usage in 30-minute intervals. By providing a more detailed view of energy consumption, smart meters enable Market-wide Half-Hourly Settlement (MHHS) tariffs, which promote greater transparency around energy usage. This not only leads to more accurate billing but also provides valuable insights that can help consumers adopt energy and cost saving practices.
BJSS collaborated with Elexon to implement the Helix Programme , a significant transformation initiative aimed at facilitating the rollout of MHHS.
The Helix Programme not only supports the integration of renewable energy sources, contributing to grid stability and sustainability, but it also fosters greater competition among energy providers. This competition could potentially lead to reduced costs for consumers. Currently, Elexon collects half-hourly data from 340 000 customers, but this number is expected to grow significantly as MHHS is fully implemented. The transition to MHHS is projected to deliver net benefits of up to £4.5 billion to British consumers between 2021 and 2045, marking a significant step forward in the UK’s energy journey.
Leveraging advanced metering infrastructure and digital twin technology
Advanced Metering Infrastructure (AMI) and smart meters are also revolutionising how energy providers manage the grid and interact with customers. By enabling more precise demand forecasting and efficient grid management, these technologies can help providers reduce operational costs, improve service reliability, and allow for the creation of tailored energy products and services.
Moreover, AMI plays a crucial role in supporting digital twin technology in the energy industry. Digital twin technology can create virtual representations of physical elements within the energy network – ranging from individual wind turbines to entire distribution systems, allowing energy companies to simulate and test models without the need of real-life construction, significantly reducing wastage, predicting faults with more accuracy, and highlighting areas for improvement.
In addition, digital twin technology can help energy providers adapt and upgrade existing infrastructure by providing real-time data.
Making the switch
In today’s dynamic energy market, the future of the UK’s energy sector looks promising, with regulatory support and technological advancements driving the transition towards greater energy transparency.
As more consumers and providers embrace the benefits of smart technology, the potential for a more efficient, cost-effective, and sustainable energy market becomes increasingly attainable. By making the switch to advanced metering infrastructure and leveraging the power of digital twin technology, the UK can continue to progress towards its net zero goals, while also delivering tangible benefits to consumers and energy providers alike.