Energy consumers across the residential, transport, industrial and commercial sectors need to be enabled to make changes in how they interact with the energy system. Changes in consumption behaviour, smart technology take-up, markets and policy will all be needed to ensure that the energy needs of consumers are met in a way that is clean, secure, affordable, and fair.
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A decision on the use of hydrogen for residential and commercial heat needs to be made by the Government’s 2026 deadline to give certainty to consumers on the most appropriate low carbon heating technologies for their homes and businesses.
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Electrification of existing fossil fuel energy demand, particularly for heat and transport, and growth in electricity demand in new sectors, will increase annual and peak electricity demands. This will require strategic investment in electricity generation and energy network infrastructure to meet this demand.
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Appropriate policy support needs to be put in place to support consumers to improve energy efficiency of their homes and businesses. This will help reduce energy bills via lower annual and peak energy demands. Policy support will also be crucial to overcoming infrastructure challenges that currently present barriers to uptake of low carbon technologies such as heat pumps.
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Smart technology and demand side flexibility can help mitigate the increase in peak demands from electrification, optimise the whole energy system and thereby reduce consumer energy costs. This will involve the adoption of smart meters and Time of Use Tariffs by residential consumers, smart charging of Electric Vehicles and increased industrial and commercial participation in Demand Side Response.
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All types of energy consumer need to be enabled to engage in the whole energy system of the future. Appropriate market signals need to be put in place to incentivise flexibility from consumers that is unlocked by digitalisation and smart technology.
