Demand Response During Periods of Surplus Renewable Generation
Centre for Net Zero partnered with Octopus Energy in Great Britain and Spain to test whether households would turn up electricity use during periods of surplus generation – typically very windy periods in Britain or sunny periods in Spain.
Context
Increasing variable renewable generation is leading to periods in which electricity supply exceeds demand – driving down wholesale prices, sometimes to zero or below. At such times, generators are willing to pay to supply, rather than be paid, largely due to dispatch-based subsidy schemes. However, these low or negative prices rarely feed through to consumers.
Our interim findings show that simple financial incentives can elicit domestic demand turn-up, with potential to support future system balancing needs.
Full analysis of the trial is ongoing and a working paper will be published shortly.
Field trial
The trial is the first large-scale, demand-side negative-pricing experiment, involving 120,000 consumers. It provides some of the first causal evidence on how households respond to short-notice price signals during periods of renewable oversupply. Across events aligned with high renewable output and low wholesale prices, households were randomly offered incentives to increase consumption within defined windows: discounts, free electricity, or direct payments.
Results
Our demand turn-up trials in Great Britain and Spain ran in 2025. Analysis is ongoing, but interim results have been published.
A full working paper will be published in due course.