A decree published in France’s Journal Officiel reveals the government has authorised electricity supplier EDF to pilot dynamic tariffs.
EDF will later this year test flexible tariff rates to encourage customers to adjust their consumption based on electricity generation as part of a pilot programme.
In total 6,600 households currently on EDF’s ‘basic’ rates – as opposed to those who get different prices in peak and off-peak hours – will be randomly selected to take part in the pilot scheme for tarifs modulables (flexible tariffs).
It will start on October 1st and run for one year.
Those households chosen for the scheme will be contacted by July 1st and will have three months to opt out if they prefer not to take part.
The programme will see these households offered discounted rates during periods when electricity supply in France exceeds demand. Details of the pricing structures and associated periods have not yet been revealed.
According to the decree, the final bill of those taking part in the pilot cannot exceed the amount they would have paid anyway, had they remained on their standard plan.
Overproduction
Overproduction is an increasingly common issue for EDF, as France expands its solar and wind power sectors.
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The idea is to encourage households to run their washing machines and other appliances when renewable production is operating at overcapacity – for example during the daytime, especially on sunny days.
Rather than cutting renewable power to reduce strain on the grid, the plan is to encourage users to use as much of this available energy as possible.
Nicolas Leclerc, founder of the energy consulting firm Omnegy, told Libération. “The grid may be strained because there is too much energy available, so prices plummet, or even go negative.
“It would be a shame to cut off production we would have had anyway, so it is beneficial to encourage consumption at that time to move towards an optimal cost.”
According to EDF, two pricing structures will be tested, with peak hours at certain times of system strain and the majority of the time at base rates. Tariffs could be cheaper at certain times on weekends or during other quieter periods.
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Conversely, prices will be higher during peak hours, particularly during winter.
At the end of the trial, EDF will submit an evaluation report to the Minister of Energy and the Energy Regulatory Commission (CRE). If the scheme goes well, it could become a permanent feature.
