The National Grid’s Demand Flexibility Service has already kicked in several times this winter. Here’s all the info you need about how it works.
We’re heading into yet another winter of high energy prices, with bills set to rise 5% from 1 January 2024. This is because the Ofgem energy price cap has been driven up yet again by high wholesale prices.
The situation has meant choice on the UK energy market is limited. See our energy deals comparison guide to find out more. Currently, the only way to save serious money is by reducing your usage – something we cover in detail in our energy saving tips guide. You can now also earn back up to £100 in credit this winter by cutting your consumption.
In 2022, the National Grid Electricity Supply Operator (ESO) launched the Demand Flexibility Service (DFS) in a bid to ensure there was enough power in the UK in the wake of the Russia-Ukraine war. The scheme allows you to earn back cash on your energy bills if you move your electricity use away from peak times on certain days.
Most major suppliers are taking part this year, including: British Gas, EDF, Octopus Energy and Ovo Energy. But, how does the DFS work – and how can you sign up for it? Here’s everything you need to know.
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How does the National Grid Demand Flexibility Service work?
The DFS is a scheme that allows households with a working smart meter to earn credit on their energy bills by cutting back their electricity usage at certain peak times during the colder months of the year. If you take part, all you have to do to save money is use less energy than you normally would.
Run through suppliers, the scheme kicks in when the National Grid ESO expects the UK’s energy consumption to be high at the same time as the country’s operational margin (or, in other words, its energy safety net) is low. The scheme helps the National Grid to ensure the risk of blackouts is kept to a minimum. It says people should not be alarmed about electricity supplies when it triggers a ‘live’ event because they are merely “precautionary measures”.
In these scenarios, the grid used to solely rely upon fossil fuel generators, such as coal-fired power stations, to add capacity in case of a spike in demand. But it is now also using the DFS to give itself greater wriggle room. Indeed, it expects the scheme to play more of a role this winter.
The amount you can expect to get in credit depends on your energy supplier and how much electricity the National Grid needs to save. The more power it needs, the greater the returns on offer. The Grid’s own estimates suggest you can save around £100 between November 2023 and March 2024.
When will the Demand Flexibility Service run?
DFS went live for the first time between November 2022 and March 2023. It has now been confirmed by the National Grid ESO that it will run again this winter.
There are set to be 12 test events that consumers will be able to take part in. Exact timings for each test vary from supplier to supplier but will be within a window set out by the National Grid.
These events will be in addition to ‘live’ uses of the scheme when the National Grid needs to balance itself. Based on what happened last winter, they are most likely to take place on weekdays between 4pm and 7pm, when energy consumption is normally at its peak. The maximum period National Grid says a DFS event will run for is three to four hours.
These live events are also set to be more lucrative for consumers, given the need to save energy will be more urgent. It comes as the UK is in the midst of its first major cold snap of the winter, with snow and minus temperatures widespread across the country.
If you sign up (see how below), you will be eligible for all the energy saving events – be they live ones or tests. Your energy supplier will be told a DFS event is happening at least a day in advance, although it may be shorter notice for a ‘live’ event. They should communicate this with you as soon as, or not long after, they are told by National Grid that the scheme will be running.
How to sign up for the Demand Flexibility Service
To sign up for DFS, you need to be with a supplier who’s taking part in the scheme. You will also have to have a smart meter fitted in your household.
Your energy provider may already have invited you to take part you may have to contact them to get involved. If not, you should contact them directly to see if you’re eligible. Below, we have listed the suppliers who are involved in this year’s running of DFS. Some of the schemes work in slightly different ways to the others (see our linked guides to find out more):
British Gas customers can earn credit on their bills by using less electricity than they normally do. The supplier sets a goal of reducing usage by 30% but says you will be paid for whatever you manage to save.
As well as offering the chance to save money through the DFS, British Gas has an added extra that can maximise your savings even further.
For customers who’re signed up, the supplier also applies a 50% discount to all electricity used between 11am and 4pm on a Sunday. So you can cut the price of making a roast or doing your laundry by shifting your energy use to that five-hour period.
EDF Energy’s DFS scheme is very much a no-frills affair when compared to those offered by British Gas and Octopus.
Customers will be able to earn up to £3 for each kilowatt hour (kWh) they save compared to their typical usage during test and live DFS events.
- E.on Next
E.on has not yet revealed details of its DFS scheme. But it’s been listed by Ofgem as one of the suppliers who’s taking part this winter. We will update this page as soon as we hear more.
As with EDF’s version of the DFS, Good Energy is offering a standard version of the scheme that will reward customers for saving energy compared to their typical usage.
Octopus is running the DFS with a twist. Instead of earning credit on your energy bills, you will get Octopoints.
Any energy you save compared to your average usage will earn you points (800 = £1). These can then be converted into credit. At an as yet unspecified date, you will be able to convert points into shopping or food vouchers.
Ovo’s energy reduction scheme works slightly differently to the others we’ve mentioned. The supplier will set its participating customers a reduction target based on their normal usage. They will then get money for each kWh they save below that target.
In addition to the DFS, Ovo has also set up long-term energy saving challenges running between now and 31 December 2023, and then 1 January to 31 March 2024. You will be able to earn up to £30 in credit across each event for reducing your energy use between 4pm and 7pm on weekdays.
As with Octopus Energy’s scheme, Scottish Power customers will earn points for taking part in the DFS. These will be able to be converted into egift cards.
Points will be paid out for each kWh you cut your usage by compared to a normal peak time period. We have yet to hear how much these points will be worth, but will update you as soon as we find out.
Utilita’s version of the DFS is very much a standard one, without any of the extras being offered by some of its larger rivals. You will earn back credit by cutting your energy consumption, with the supplier estimating customers will be able to get £31.75 back, on average.
- Shell Energy
Shell is also taking part in the DFS. But unlike the schemes listed above, it will not pay customers directly for cutting back their use. Instead, you’ll be entered into a prize draw where you can win gift cards.
How can I save money with the National Grid Demand Flexibility Service?
To save money through DFS, you have to consume less electricity than usual. Your supplier will track your usage during the scheme via your smart meter and compare it to how much you would use under normal circumstances. If you sign up, there is no obligation to cut back your consumption.
Some suppliers may say you have to cut back your energy usage by a certain threshold (eg, 1kWh below a specific target). Others will pay you back for whatever you save, even if the amount is only tiny. For every unit (or kilowatt hour) of electricity that was saved during the last DFS period last winter, the National Grid paid suppliers between £3 and £6. It is up to the supplier how much of this figure they pass on, but National Grid estimates a typical household could save around £100 over the course of the winter.
Our energy saving top tips guide will help to show you specific ways in which you can scale back your energy usage around the home. But here are some quick bits of specific advice on how you can save money during a DFS session (like the one tonight):
- Use your washing machine after DFS ends: got some urgent washing to do? Hold off until the DFS time ends. The same goes for your dishwasher and tumble dryer.
- Batch cook in advance: if you can cook your evening meal before DFS, you will be likely to save a lot of energy compared to your typical usage. Should you need to heat up a meal, use your hob or microwave rather than your oven.
- Create a flask of tea: want to take part in DFS but fancy a cuppa? Put together a flask of your hot drink of choice in advance of the scheme to avoid burning up energy with your kettle.
- Switch appliances off at the plug: by doing this, you should be able to save at least some energy compared to your regular consumption.
- Be strict with your timings: make sure you follow the DFS hours closely.
Another option is to not use any power at all. Last year, there were reports of people going for bike rides, heading to the gym or going out for a walk when a DFS event was taking place.