£20m to cut energy use

A new government pilot project will enable firms to bid for payments tied to the delivery of electricity demand reduction at peak periods.

Businesses and other organisations will be paid for cutting their power use under a £20m electricity demand reduction (EDR) scheme, energy and climate secretary Ed Davey announced on 13 September.

The pilot scheme will start in summer next year and last for two years. It will enable DECC to test its electricity demand reduction strategy which will now be based on the so-called capacity mechanism.

The mechanism was brought in following an amendment to the energy bill (endsreport.com/39056) in May. It is due to be introduced in 2014 and is meant to guarantee security of supply by paying gas plants to generate at times of peak demand.

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