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Old 23-04-2025, 16:16   #895
Chris
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Re: Smart Meters and Tariffs

Yes and no.

Price variations between region are to do with network distribution costs. The DNOs are allowed to charge different rates across the country. In theory that should only show up on the standing charge which is, notionally, the bit of your bill that you pay to maintain access to a mains electricity supply regardless of how much you use. In practice, standing charges have just become a way of penalising energy efficiency so the variation in local distribution costs tends to be accounted for partly in the unit price as well as the standing charge.

What we do not presently have is full zonal pricing. We have a single GB-wide ‘zone’ in which the cost of generating and transmitting electricity is treated as being the same across the entire grid. If you allow those costs to be calculated and charged regionally, as local network distribution costs are, then that starts to make a very significant difference to the costs consumers pay for electricity.

Scotland and the north of England would stand to benefit from such an arrangement very rapidly because there is such an enormous wind generation capacity here now, and the unit cost of that is low.

The CEO of Octopus is a passionate believer in zonal pricing and has written about it … will see if I can find something.

Edit …

https://octopus.energy/press/zonal-p...-report-finds/
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