Octopus Energy boss: some people would accept blackouts if bills cut | Energy industry

The boss of the UK’s biggest energy provider has suggested some households will accept an occasional power outage in return for much lower energy bills.

A year after Europe’s biggest power outage – which left tens of millions of people in Spain and Portugal without trains, subways, traffic lights, ATMs, phone connections and internet access – the chief executive of Octopus Energy has spoken out against costly investments in Britain’s electricity network that are driving up household bills.

Greg Jackson told an industry conference that many homes in Spain, where Octopus Energy has a growing business, would be happy to accept “a few power outages” in exchange for 25% lower electricity costs.

“To be very clear, I’m not advocating power cuts, but if you asked Spanish consumers: ‘Would you accept a few power cuts in exchange for 25% lower electricity costs, or no peaks, or a more reliable economy?’ enough of them would say yes,” he said.

People would be “much less bothered” by a power outage now than in the past, Jackson added, because they could continue to watch things on their laptops during a power outage.

“They have a battery in there that gives them a few hours,” Jackson said. He added that home batteries, sold by Octopus Energy, are “so cheap now” that even people who need reliable electricity to run medical equipment would be able to tolerate a power outage.

Jackson, 54, made the comments, which were first reported in Utility Week, on the anniversary of the Iberian blackout, in response to a question from the audience about the challenges of managing a renewables-heavy energy system like Spain’s.

The widespread power outage claimed the lives of at least six people in Spain and Portugal, including two people with health problems who died after being unable to operate breathing apparatus.

Jackson told conference delegates that the biggest challenge in running a clean energy system was controlling the cost of network investments. Octopus Energy has clearly warned against investments in the network that could prove unnecessarily costly as new technologies emerge.

An Octopus Energy spokesperson said: “Countries that have adopted cheap renewables and built in flexibility – such as Spain – see significantly lower energy prices and are much less exposed to peaks.

“Meanwhile, the UK risks doing the opposite: imposing high costs with tens of billions in network and network spending, without enough transparency about whether any of this is really necessary. »

Gas and electricity bills are set to rise to almost £2,000 a year for the average bill for both fuels from July, as households struggle to pay off record debts totaling more than £4.5 billion.

The increase in household energy bills is due to the sharp increase in the market price of gas due to the conflict in the Middle East, which has also increased electricity costs due to continued reliance on gas plants.

But the cost of modernizing power lines and networks is also driving up bills. The cost of network upgrades, which are paid for by energy bills, has increased from around £254 a year under the price cap set for summer 2021 to £457 under the current cap.

“Be flexible and the bills go down,” the Octopus spokesperson said. “Ignore it, and we risk overbuilding for decades.”

Renewable energy critics initially blamed the outage on Spain’s reliance on wind and solar power, but the official report said “multiple interacting factors”, involving conventional power plants, renewables and the electricity grid, played a role in Europe’s largest blackout.

Speaking at the same event, Fintan Slye, chief executive of the National Energy System Operator, responsible for keeping Britain’s lights on, said there was expected to be a “step change” in the way households use electricity, which “won’t extend to power cuts”.

Slye said significant investment in the power grid was still needed to enable electricity to be transported from where it is produced to where people are.