Key Stats

• Free electricity increased hourly household power use by 31% during the Great Britain experiment.
• A 50% discount raised British consumption by 14.3%, less than half the response to free electricity.
• Paying British customers an additional 15 pence per kilowatt-hour lifted consumption by 34%, only slightly above the free-electricity result.
• Free electricity raised consumption by 12.7% in Spain, while adding a 10-cent payment increased it by 13.4%.
• The nationwide experiments involved roughly 120,000 residential customers across Great Britain and Spain.

Note: The figures measure hourly electricity use during short, advance-notice events among Octopus Energy customers. British events lasted one hour and Spanish events lasted two hours.

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Free electricity increased household power consumption by 31% during a Great Britain field experiment, but paying customers to use power produced little additional demand beyond reducing the price to zero, according to a new NBER working paper.

The randomized experiments tested whether households could be encouraged to use more electricity when renewable generation was abundant and wholesale prices were close to zero or negative.

In Great Britain, a 50% discount increased hourly consumption by 14.3% compared with the control group. Making electricity free more than doubled the response, raising use by 31%.

A payment of 5 pence per kilowatt-hour on top of free electricity increased consumption by 33.8%. Raising the payment to 15 pence produced a nearly identical 34% increase.

The results suggest that reducing the household price to zero generated most of the available response. Larger negative prices, under which customers were paid to consume, produced little further increase.

Spanish households followed the same general pattern, although their response was smaller. A 50% discount increased hourly use by 6%, free electricity raised it by 12.7%, and free electricity plus a 10-cent payment lifted it by 13.4%.

How the experiments worked

The researchers conducted five nationwide events in each country between June and September 2025, involving roughly 60,000 customers in Great Britain and 60,000 in Spain.

Customers were randomly assigned to control, half-price, free-electricity or negative-price groups. They received an email about the timing and incentive approximately 24 hours before each event.

Events were called when day-ahead wholesale prices were expected to be close to zero or negative. They lasted one hour in Great Britain and two hours in Spain.

The study also examined 15 locally targeted events involving 14,477 enrolled customers in northern England. Those events offered free electricity when local renewable production exceeded what the distribution network could accommodate.

About 20.4% of invited customers had enrolled in that program. Limiting rewards to participating customers reduced the payment per additional kilowatt-hour of demand from £1.22 in the nationwide British trial to £0.77 in the local trial.

British households mostly shifted when they used power

The British increase during free-electricity periods did not appear to represent a lasting rise in total consumption. Higher use during the events was largely offset by reduced consumption in surrounding hours.

In Spain, by contrast, the researchers found evidence of net additional consumption rather than the same degree of shifting from nearby hours.

That distinction matters because shifting existing electricity use can still help the grid. Moving vehicle charging, heating or appliance use into periods of excess renewable supply may reduce the need to switch off available wind or solar generation.

Customers with electric-vehicle or rooftop-solar tariffs responded more strongly in Great Britain, especially under free and negative prices. Households on time-of-use tariffs also showed larger responses than customers paying a fixed rate.

The findings complement earlier StatsJournalist coverage of electricity price responsiveness, which found little long-term evidence that total demand has become more sensitive to prices despite the spread of smart meters and other technology.

Why it matters

Electricity systems must continuously balance supply and demand. When wind or solar generation exceeds demand or cannot be transported through a congested network, operators may pay generators to reduce output or order them to do so.

The experiments tested an alternative: encourage households to use electricity during those surplus periods instead of discarding available generation.

Using a year of Great Britain settlement data, the paper models approximately £18.2 million in annual consumer surplus if demand turn-up were expanded across Scotland’s estimated 2.55 million households under the authors’ assumptions.

That figure is a modeled estimate rather than an observed result. The authors also describe residential demand turn-up as a complement to storage, transmission upgrades and curtailment, not a complete replacement for them.

The findings remain preliminary

The paper is an NBER working paper and has not been peer reviewed. Its experimental findings cover customers of one energy company and ten short nationwide events during a four-month period.

The British response to free and negative prices also weakened after repeated exposure, suggesting that novelty may have contributed to the average result. The effect of a frequent, permanent program could therefore be smaller.

The paper includes substantial industry involvement. Two authors were employees of Octopus Energy Group, one was employed by the company during the trial and later joined Octopus Energy España, and another was a consultant to the Centre for Net Zero, which is part of the same group.

The authors state that they retained final responsibility for the experimental design, analysis and paper. The disclosed relationships should still be considered when interpreting the results.

Overall, the experiments suggest that free electricity can move a meaningful amount of household demand into periods of abundant supply. Paying customers more after the price reached zero, however, generated little additional response.