Octopus launches first tariff that could pay you to use energy
- Octopus launches first tariff to offer half-hourly prices, reflecting actual wholesale costs
- “Plunge Pricing” pays customers to use electricity when demand is low or supply is high
- Electric vehicle owners can save up to £669 per year
- Supports renewable energy by rewarding consumers for using excess energy generated from wind and solar on the grid
Today, Octopus Energy launches Agile Octopus – the world’s first energy tariff to pay domestic customers to use electricity when wholesale prices plunge.
Across Britain, whenever more electricity is generated than consumed, wholesale prices fall – sometimes to below 0p / kWh, when suppliers are paid to take energy off the grid.
The new Agile Octopus tariff introduces ‘Plunge Pricing’, which passes these negative prices on to customers – effectively paying them to use energy during times of over-supply.
Customers will be alerted to ‘Plunge Pricing’ via text message, email or via their online dashboard, and once a month they will be sent a full breakdown of their half-hourly energy pricing and usage.
Greg Jackson, founder and CEO of Octopus Energy, said:
“This tariff is groundbreaking. By reflecting the real cost of energy on the grid every half hour, customers can capitalise on times when prices are especially low. Indeed, if the wholesale price goes below 0p / kWh, Octopus Agile will actually pay you to take the unwanted energy from the grid. As renewable energy production grows these events are only going to become more frequent.
“As well as having launched the first (and only) daily price tracker, this innovative tariff proves that it is challenger suppliers like Octopus Energy, not the Big Six, who are leading the way in unleashing the power of renewables.
“The Agile Octopus tariff cements Octopus’s claim to be the most progressive and innovative energy supplier in the UK and we’re excited about what we can do to help our customers move to a more renewable future.”
Supporting a greener Britain
Historically, big drops in energy prices have occurred overnight as energy consumption drops. However, with ever-increasing amounts of renewable energy available from solar and wind generation, such events are becoming more frequent.
This tariff enables anyone with the ability to shift their energy consumption – whether by setting timers for dishwashers and washing machines, using storage heaters, or setting the time for their electric vehicle charging – to get rewarded for helping reduce the stress on the grid.
A smart tariff for transparency
Octopus Energy can offer “Plunge Pricing” thanks to its innovative use of dynamic pricing, which sees half-hourly energy prices set daily at 4pm for the following 24 hours. Prices are tied to publicly published wholesale costs to ensure full transparency. Charges are then calculated for each customer using the half-hourly consumption data from a smart meter, ensuring accuracy.
The tariff features an API (application programming interface), allowing customers to access dynamic pricing and use it to schedule smart devices, electric vehicles, and chargers.
Over the last 12 months:
- The unit price of electricity dropped below 2p / kWh 31 times
- There were 4 “Plunge Price” events when the unit price of electricity dropped below 0p / kWh
- A typical home with a typical consumption profile would have saved £231 compared to the average Big 6 variable tariff
- A home-charging EV owner could have saved £669 compared to the average Big 6 variable tariff
- Agile Octopus is available from midnight 21st February to all Octopus customers with a Secure brand smart electricity meter installed in their home. The tariff can be accessed here: https://octopus.energy/agile
- At 4pm each day, customer’s unit rates are published to their online account so they see the rates they will pay, based on wholesale market rates.
- As wholesale energy prices can be volatile, the tariff includes “Price Cap Protect” which limits the maximum unit price a customer will be charged in any given half-hourly segment.
- Octopus customers without a smart meter can have one installed on request; and customers with other suppliers can switch to Octopus to join a waiting list for smart meter installation, and to join the tariff.
- Quoted savings based on a medium consumption as defined by Ofgem (3,100 kWh of electricity, 12,000 kWh of gas). EV owner savings based on a medium consumption plus an additional 5,000 kWh of EV charging per year (for a large EV travelling 16,000 miles per year) using 75% of their electricity between 00:00 – 08:00.
For journalists in their professional capacity only. Issued by Octopus Energy Ltd. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 09263424. Issued: February 2018.