Does your business get half-hourly electricity bills? Act now before the Triad season to minimise costs.
The winter is almost upon us. As the days get colder and the evenings draw in, demand for electricity from businesses and households rises.
To manage this demand, the National Grid uses Triads to encourage businesses to reduce electricity consumption at peak times. It’s important to understand how these work as they can have a big impact on your total electricity bill.
Triads are the three half-hour periods during the winter that see the highest demand for electricity. “Tri” refers to the three periods, while “AD” stands for average demand.
They can be on any day from 1 November to the end of February. But there’s one condition. They must be at least 10 days apart so that they don’t fall on consecutive days.
What time of day? Triads usually occur between 5.00pm and 6.00pm because that’s when both industrial and domestic consumption tends to peak. But they do sometimes fall outside this window.
Triads only affect businesses that get half-hourly bills, mainly medium and large industrial and commercial enterprises.
One of the most significant non-commodity costs on a business energy bill is the Transmission Network Use of System (TNUoS) charge. That’s what you pay to maintain the electricity transmission system in the UK.
Here’s the key point: if you get half-hourly bills, your total TNUoS charge for the coming financial year is calculated based on your average consumption in the three half-hour Triad periods. So if you’re a heavy user of electricity, optimising these costs can make a big difference to your annual spend – the more you reduce your energy usage during Triads, the lower your TNUoS payments will be for the whole of the next year.
But first you need to know when Triads will occur.
Unfortunately, we can’t predict these spikes in demand with 100% certainty.
That’s mainly because Triads are only determined after the event. Every year in March, National Grid ESO looks back through the season’s data to find the three highest consumption peaks with at least 10 days between each one. So businesses have to wait until spring to find out if they’ve got their forecasting right.
A growing awareness of Triads has also complicated predictions in recent years. The more businesses realise the impact they have on charges, the more they cut consumption in typical peak periods, which affects when they occur. And the increasing use of embedded generation and demand-side response is also levelling out demand.
Changing weather patterns can upset expectations, too. February 2019 was exceptionally warm, so there were no Triads that month. In contrast, two of the three Triads fell in February 2018, as the country was swathed in snow.
Despite this uncertainty, there is action you can take to minimise their impact:
Remember one important caveat as you prepare for winter: Triads won’t be around for much longer.
Ofgem’s Targeted Charging Review has decided that fixed charges are to replace the current Triad charging system. New fixed charging schemes for both transmission (TNUoS) and distribution (DUoS) charges are likely to go live from April 2022.
So if you’re planning to make changes to cut consumption in Triad periods, consider carefully your return on investment. It may not be worth it before they end. On the other hand, reducing your overall energy usage – treating every day like a Triad – will play an even greater role in cutting costs in future.
Whatever you do, don’t be caught out by Triads this winter. Sign up for our free Triad warnings today.
Like this post? Stay informed by signing up to email updates