Three Big Reasons Why Now is the Time For Windfall Energy
The country needs an energy system that is more flexible as we meet the needs of homes and businesses through harnessing the intermittent nature of renewable energy. Britain is a world leader in a range of exciting new clean flexibility technologies and services that support this ambition, such as consumer-led flexibility and batteries.¹
Rt Hon Michael Shanks M P, Minister for Energy
There are many reasons a business can fail, and timing is a critical factor. Too early and the technology or the market might not be ready. Too late and you could miss the boat entirely.
“Why now?” is a classic question asked of start-ups. Why is this the time to launch this business?
Our answer lies in a convergence of three powerful forces: simple economics for the individual, a national imperative for a more flexible energy system, and a global need for innovation.
Microeconomics
The first key reason Windfall Energy can work now is that our battery makes financial sense.
UK electricity prices are high compared with other countries in Europe. People who own big houses, and with the money to do so, can install solar panels and heat pumps to help reduce their bills. For the other half of people, who rent or live in smaller homes, those are not options.
Our proposition is fairly simple. We offer those people a battery that charges up with cheap off-peak electricity, and then the home uses it during the peak times.
However, this only works if the off-peak saving is enough, and if the battery is cheap enough to make it all worthwhile.
Over the last decade or so, both those factors have changed dramatically. The price of lithium-ion batteries has come down over 80%² and the cost of UK electricity has almost trebled³.
An example of a simple two-rate electricity tariff in the UK has night-time, off-peak electricity at 8.5p/kWh and a peak price of 28.0p/kWh. The difference in percentage terms is massive, but even in absolute terms those pennies add up. More dynamic tariffs are also available and these can unlock even more saving potential.
Although our customers care about carbon emissions, frankly, most people care more about the money savings.
Macroeconomics
So our timing makes sense for individual customers, but it also makes sense in a wider context. The UK’s electricity generation includes more and more renewable sources. Which is fundamentally a good thing, but it does make the national energy system a bit harder to manage. Wind- and solar-generated electricity is by its nature inconsistent, and it’s also often generated far away from where it’s needed.
Consumer-led flexibility
As well as big things like nuclear power stations and grid-scale storage, the government is emphasising the importance of consumer-led demand flexibility. Legislation and regulation are evolving to open up opportunities for innovation.
To quote from a recent consultation document from the Department for Energy Security and Net Zero:
Clean flexibility is the cornerstone of the government’s plan to reach clean power by 2030 and net zero by 2050. The country needs a more flexible electricity system to meet the needs of homes and businesses as we harness renewable energy and electrify energy demand sectors. We need sources of electricity flexibility, like consumer-led flexibility (CLF), batteries, interconnectors, and long-duration electricity storage (LDES), to keep supply and demand balanced cleanly and cost-effectively.
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CLF provides benefits for all consumers, including through the reduction of energy system costs by minimising the amount of peaking generation and network infrastructure that would otherwise need to be built, compared to a system with lower flexible capacity . Consumers who directly participate in CLF have the potential to save significantly more, for example, smart charging of electric vehicles can already save typical EV drivers around £330 per year . Participation in flexibility will be voluntary and attractive, empowering consumers with greater control over their energy use and unlocking tangible savings without disrupting their everyday lives.
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Along with grid-scale batteries and interconnectors, CLF could help reduce system costs between £30-70bn from 2020 to 2050.⁴
Grid services for energy companies
Sitting between the national energy infrastructure and the consumers in their homes, are the energy companies.
Grid services are an increasingly important source of revenue and stability for these energy companies. Traditionally, they made money by generating and selling electricity. Grid services, however, involve a range of actions that help the grid operator maintain a constant balance between electricity supply and demand, and the energy companies get paid for providing these services.
As well as being a great differentiator that can win them new customers on its own, Windfall Batteries can be aggregated together and enable energy companies to participate in grid services.
The world needs innovation
If you’re reading this, I imagine I don’t need to convince you that climate change is a thing. While there may have been some political bumps in the road in recent years, the general direction of travel is consistent. I don’t think it’s hyperbole to say that this is about an entire species recognising an existential threat.
No single solution will get us out of the mess we’ve got ourselves into. Small-scale batteries in homes are just part of the answer. They can make a big difference though, and have the advantage that they’re relatively fast to roll out.
The microeconomics work, the macroeconomics work, and the planet needs this now.
You may have heard the old proverb about the best time to plant a tree. The best time to plant a tree was 20 years ago, the second best time is now.
When it comes to climate change there are enormous challenges to address. It can seem overwhelming at times, but if you never even try because you’re waiting for the perfect time, then you’re guaranteed to not succeed.
Here at Windfall Energy, the prevailing winds are with us and we believe that saving money and saving the planet aren't separate goals. By putting a Windfall battery in your home, you're not just taking control of your energy bills; you're helping build a cleaner, more flexible grid for everyone.
