Call for Smart Building Rating metric to scale up demand flexibility

The Centre for Net Zero and Energy Systems Catapult have proposed the introduction of a ‘Smart Building Rating’ (SBR) to incentivise demand flexibility at scale across the UK.

This proposal follows successful consumer flexibility trials last winter, where over a million households were paid to adjust their energy usage times. The SBR, supported by a cross-industry coalition and the Chair of the Independent Net Zero Review, Chris Skidmore, is designed to complement a reformed Energy Performance Certificate (EPC) and drive the UK towards an efficient and smart building stock.

The SBR measures a building’s capacity for flexibility or “smartness”, placing a value on flexibility that encourages consumers and incentivises property upgrades. Buildings equipped with low-carbon technologies capable of delivering flexibility, such as EV chargers, heat pumps, smart thermal stores, batteries, and solar, will be prepared for “smart” electrification. Demand flexibility could save the system between £9.6 and £16.7 billion in 2050 and save individual households up to 52% on wholesale electricity costs in 2040.

While the benefits of demand flexibility are clear, no policy mechanism exists to drive the transformation needed. The Centre for Net Zero and Energy Systems Catapult are urging the government to consult on the introduction of a new measure of demand flexibility and work with the industry on its effective implementation, alongside reforming EPCs. They will also be collaborating on the development and trial of a proof-of-concept SBR to demonstrate its policy value.

The the full report is available on the Centre for Net Zero website.

Rt Hon Chris Skidmore MP OBE:

“Decarbonising homes is at the heart of the UK’s journey to net zero. The future energy system will need buildings to be both energy efficient and able to provide energy flexibility. In placing a value on a building’s capacity for energy flexibility, the Smart Building Rating can help us to achieve this. It is a prime example of forward-thinking policy-making that aligns with a data-driven, digital future energy system.”

Lucy Yu, CEO of Centre for Net Zero:

“Flexibility is not optional; it is essential to a net zero energy system. Whilst it comes in many forms, consumer flexibility is the lowest-cost way of keeping supply and demand in balance – but the current landscape is not conducive to rapidly scaling it. The Smart Building Rating is designed to confront this challenge head on, ensuring that we can unlock the benefits that a flexible energy system affords – from cheaper bills to cleaner, more secure energy.”

Guy Newey, CEO of Energy Systems Catapult:

“The Smart Building Rating would enable businesses, government and other stakeholders to better target and incentivise uptake of the technologies needed to achieve flexibility from homes. It would also help to stimulate innovation, boosting the market for new flexible products and services, where the UK has some of the most exciting and high growth-potential companies. At Energy Systems Catapult, we look forward to working with Centre for Net Zero and others to develop this proposal further, so we can build an energy system that is inclusive, affordable and clean.”