Liz Allan [00:00:02]:
Welcome to Electric Evolution with Liz Allan. This podcast is about the journey to a more sustainable future in order for us to be able to do our bit to achieve net zero. I'll be discussing a variety of topics with experts in their field in order to to take and increase our knowledge of clean energy, electric vehicles, and the electric vehicle infrastructure. So whether you're an individual who wants to make a difference at home, to small business or a corporate, this podcast is just for you. Okay. So today on the podcast, to I have got Max Van Der Lande, and you are working at Octopus Energy, aren't you? So thank you very much for for joining
Max Van Der Lande [00:00:42]:
me, Max. No. It's a pleasure to be on. Thank you very much for inviting me. I feel feel honored to be on the podcast.
Liz Allan [00:00:47]:
Oh, stop it. Thank you. No. It's great. To And I spotted you on LinkedIn when you were talking about tariffs. So so Max, it so you're a re renewable energy analyst there, aren't you? And what you were talking about was something that I was really quite interested in, which was about smart tariffs. But first, can you tell me, So so what what does a renewable energy analyst do? And that's a bit of a mouthful, isn't it? But what do what do you do, Octopus?
Max Van Der Lande [00:01:22]:
To face. Right. So I actually work for Octopus Energy Generation, which is our sort of generation arm of the business. And that really focuses on 2 things, able Building more renewable energy generation, and that's often sort of taken under the wing of our sort of asset management arm. And then you also have, like a really innovative part of the team, which focuses on connecting customers to this generation and making it sort of more accessible and cheaper. So So sort of, like, trying to innovate in that in that generation sort of area. What do I do day to day? Really varies. So I'm so I work across a number of projects.
Max Van Der Lande [00:01:56]:
So, as you said, smart tariffs, particularly for business, is is one of the products I've been working on heavily recently. But I'm also involved in trying to to Unlock onshore wind in the UK, particularly in England. I'm also involved in sort of trying to lead some sort of thoughts, Thought pieces around sort of grid connections, and just sort of un un it's basically unlocking renewables in the UK is probably probably the one theme, I'd say.
Liz Allan [00:02:20]:
Okay. And go on to when you're saying about on about grid connections, what what what do you what do you mean in there?
Max Van Der Lande [00:02:28]:
So many people don't know this, but one of the biggest issues right now in deploying generation is trying to get a great connection. If you've got a solar farm and you wanna to Connect to the grid. You gotta apply to the grid, or a wind turbine or etcetera. And one of the this this sort of at first, 5 years ago, this might have taken a year to get a good connection, to And you might have to pay for a small number of upgrades. Problem we've got right now is that the grids really hasn't been designed for this sort of Decentralized connections built around of centralized. You have 1 coal power station. You have 1 nuclear reactor, and it's all feeds in and it feeds down to the houses. But the way we're building renewables now is we're sort of decentralizing it.
Max Van Der Lande [00:03:06]:
So lots of small scale generation feeding up and then back down. Able and so what's happened now is getting a connection can take up to 10 years or more. We're seeing sort of connection deadlines to ex in excessive of 2035. So many new renewable projects are basically unable to sort of proceed simply based on their grid connection, which is which is not ideal when we're trying to decarbonize the electricity system.
Liz Allan [00:03:39]:
No. So why would you say is it so problematic? Yeah.
Max Van Der Lande [00:03:45]:
So this Is
Liz Allan [00:03:46]:
it is it just because the so I as you know, I've spoken probably know I've spoken to Graeme Cooper, but I wasn't I I suppose I didn't realize about the length of time these things had had had take. That's that's a long time, isn't it?
Max Van Der Lande [00:04:02]:
Yeah. It it it's it's it's it varies a lot by where you are in the UK. But it's not it's it's a 10 year plus connection time is is unfeasible for almost all projects. So No. That's that's
Liz Allan [00:04:13]:
one of the
Max Van Der Lande [00:04:14]:
big problems. So why is it so bad? It's, There's a few reasons. Firstly, it is we are transforming the whole sort of infrastructure of the grid. So flipping out its head slightly. So this decentralized to decentralized approach. Able I think when the grid so 5 years ago, as I mentioned, when people were first connecting, there was what we described as headroom. So excess capacity to be on the grid essentially. And that headroom is sort of been incrementally taken up by these new projects, and we sort of reached that tipping point able Where often when you're creating a project, you might not just have to upgrade your sort of local network, but it sort of triggers a sort of, Domino effect of upgrades up the sort of connection voltages and up the scales.
Max Van Der Lande [00:04:54]:
So it's connecting even a relatively small project. You may find yourself lumped with up to 1,000,000 in in sort of connection fees, which again, unfeasible. There's lots of really interesting things that are going on right now, able to try and solve these problems, to sort of knock down one of the problems, okay, is there's Because of the situation, what a lot of people do is just fire out millions of grid connection applications Across the UK. So you've got this whole market for for for applications that have been submitted, and there's a sort of queuing system in this. So if it's a sort of first come, first serve basis. So even if your project is more viable than all the rest of it, but there's someone in the queue in front of you, who's just sitting on their position, unsure if they're gonna proceed or not. That can really delay your connection. So one of the things National Grid is doing is basically sort of saying, At at the moment, there's a bit of an amnesty.
Max Van Der Lande [00:05:48]:
We'll let you drop out of the queue, and we won't charge you a fee for doing it. Normally, there's a bit to penalty if you sort of apply then drop out. Oh, god. Okay. So this is one of the things. There's an amnesty. Another sort of initiative we're sort of trying to work out is, Obviously, these connections often do need to be upgraded. And so what we can do is we can we're trying to work our way of collecting together.
Max Van Der Lande [00:06:11]:
So say say you're a farmer and you wanna build some some solar, and the next door farm, the next door farm, the next door farm, they all want to do it. Why don't you share the cost and distribute this sort of cost? At the moment, we've got call what we call a a first mover problem. The first one to sort of move to Pays for the upgrades, and then everyone else in behind them can use and utilize these upgrades. There's a bit of a payback on it right now, but not not a very sensible one. So that's one of the approaches. But, yeah, there's there's there's a number of there's there's really a whole sort of plethora of issues issues around the grid in the UK and getting grid connections. I think there's also a sort of assumption, as I mentioned, sort of is a there's a worst case to some a worst case assumption, essentially. So when you're applying your grid, there are they basically take the to You are gonna be exporting at your absolute maximum, at the worst time possible.
Max Van Der Lande [00:07:01]:
Now a national grid is is aware of this, and they're sort of Taking a starting to take a slightly more nuanced approach. And this came out in the news, I think, last week, where they for battery projects to Had previously been assuming, worst case scenario, that they would be exporting at maximum capacity in the evening peak. Sorry. Sorry. Importing to Importing in the evening peak. Sorry. Importing. So putting extra strain on the grid.
Max Van Der Lande [00:07:26]:
But which which battery operator in their right mind would be charging their battery When the electricity is at its absolute most expensive, this is, you know, sort of 5, 6 PM PM. They're starting to say, okay. Well, maybe you won't be exporting, importing them. Able They maybe maybe that isn't really a worst case. So there's a sort of changing how they evaluate projects is is is improving. So that's the sort of grid connection piece. It's really complicated, but there's a lot of So moving parts to it. I think there was actually a a press release today by Octopus sort of we're we're constantly trying to challenge National Grid to go further and further And sort of try and keep up.
Max Van Der Lande [00:08:05]:
The amount of upgrades needed to sort of allow us to decarbonize the electricity network is is phenomenal. I think I think it was up to £35,000,000,000 in investment National Grid is now gonna have to do, and it's probably gonna keep increasing that number. But there's a so that's a connection problem, but there's actually a sort of second tier problem on top of that. It's lots of lots of wind projects people know go up in up in Scotland. Very windy, slightly more rural, easier to get planning permission, lots of reasons like that.
Liz Allan [00:08:35]:
And this is on this is onshore rather than offshore, isn't it? Because in Scotland, they've got offshore and onshore, haven't they?
Max Van Der Lande [00:08:41]:
Am I right? Exactly. I mean, you're exactly right. So they they're to Leading in the UK in terms of onshore. They've also got lots of offshore as well. Mhmm. But, of course, lots of the demand in the UK is where? It's able around that sort of taking energy from one end of the country and moving it to the other. And I know that sort of the Cornish feel similar on on this as well. They don't wanna feel like they're being exploited.
Max Van Der Lande [00:09:07]:
No one's to exploit anyone. But there is this problem where you gotta move the energy from from a to b. Now it's a long way to go, and there's there's some some pinch points in the way. And what happens is if the if the grid infrastructure, if the national transmission network can't take that energy from a to b, What happens is the National Grid basically pay pay 2 people. Firstly, they pay the wind turbines to stop turning. They say, look. We'll compensate you. Stop turning.
Max Van Der Lande [00:09:34]:
And then what they'll do then is they'll typically turn on a nash, a gas generator, let's say, down south, To then go and burn some gas near the near the point of demand. So there's there's 3 things going on here. Firstly, you're you're you're spending loads of money, which is just I think, for context, it came to almost £1,000,000,000 last year. It was spent doing this.
Liz Allan [00:09:58]:
Oh my god. To
Max Van Der Lande [00:09:59]:
It's not a small number, and that number It's not. We're gonna increase. So they're only gonna increase. So about £1,000,000,000 being spent, last year, on this. Secondly, you're you're burning a lot of gas. You know? You you you're basically turning off Low carbon, 0 carbon at the point of use, and turning on some gas generators. So so and then third thing is All this money costs the consumer. It goes straight to the consumer.
Max Van Der Lande [00:10:25]:
So it's a pass through bill. So it's making everyone's electricity more expensive. Massive piece about grid upgrade requirements. Of course, that's in itself nuanced because no one wants big to Pylons going going through areas outside natural beauty. Yeah. So it's it's it's just a it's a big problem. And there's undersea cable projects going on, but, expensive, timely, etcetera, etcetera. But this is sort of where lots of my work comes in.
Max Van Der Lande [00:10:54]:
We're this is why this decentralized approach is far more favorable. It's what we're sort of doing we're doing it half heartedly. To We're sort of seeing a centralization of of generation up in Scotland, partly in planning, partly due to, sort of, environmental factors, but it's not it's not really serving the needs of the consumer. So this is where we're sort of trying to build this local consumer connected generation. That's that's what I that's
Liz Allan [00:11:24]:
what I that's what I
Max Van Der Lande [00:11:24]:
that's what that's to That's my niche, trying to connect consumers to their generation.
Liz Allan [00:11:28]:
Do you know it sounds fascinating, but frustrating for you. And and for us to actually, you know, to to hear the fact that what we thought was happening isn't actually happening. Like you say, if it's £1,000,000,000 for them to to stop one thing and start something else, so to oh, you know, that that I suppose, thinking about it, you know, I'm I'm just thinking, surely, there's a there's an easier way to do this. You know, come on. We don't wanna do that. We want we want we don't want gas. We don't want power stations being set, you know, set Going again, we want we want to actually have renewables working on this. But Okay.
Liz Allan [00:12:09]:
So I didn't realize that I suppose I'm realizing it, obviously, in times of stress and and and need that these things happen, but I didn't realize it was kind of because of the fact that they can't get they can't get one you know, the power from one place to another because of the distance.
Max Van Der Lande [00:12:37]:
To top here octopus, is is is decentralized energy. And there's a two two ways I'm personally involved in doing that. That's sort of max power, which you can to come up with a little bit, and there's this onshore wind. So the onshore wind piece, the people who don't know this, onshore wind in in England has essentially been banned for 2015. Yes. And when we say essentially ban, do because there was no real ban. There's a memorandum. There's a footnote 54.
Max Van Der Lande [00:13:08]:
There's a buzzword, buzzword, buzzword, to But there's been a 98% reduction in the build out of onshore within England. So it's it's essentially a ban. And so there's been a consultation which we've been feeding into recently trying to unlock onshore wind development again in in England, But doing it the right way. We only want to develop where consumers want it. So a short history lesson, I suppose. We were up to 2015. There was a sort of national interest in developing onshore wind. The government really wanted to do it.
Max Van Der Lande [00:13:38]:
Everyone really wanted to do it. And then we sort of got these large organizations to Building large wind turbines in little rural villages, and the villages are really having no no say in saying, so suck it up. It's happening. Able and then, of course, everyone sort of kicked back and said, no. This is not how it should be done at all. Yeah. And the result was, well, the ban. We like this time.
Max Van Der Lande [00:13:58]:
Let's let's unlock it, and let's do it right. Let let's let's let's meet where consumers want to. Mhmm. There's there's a a few really exciting projects which we talked to as sort of, sort of led the way with. Our sort of process starts with something called fan club. No. Okay. Fan club.
Max Van Der Lande [00:14:15]:
It's, so when we say fan, we mean wind turbine. Yeah.
Liz Allan [00:14:18]:
I get you. I get
Max Van Der Lande [00:14:19]:
you. Yeah. For those for those you don't quite follow. So so we have something called a fan club, where essentially, we we right now have 3 to Fans, turbines, and 1 fan tune factory Mhmm. Spread over the North England and South Wales. And what we did, we said, well, If you live in the area, the postcodes around these, if you live in the sorry. If you live in the postcode areas around these and the wind is blowing, what What you can do is have a discount on your energy. So if the wind's blowing a little bit, you get a 10%.
Max Van Der Lande [00:14:51]:
If it's blowing a lot, you get 20. And if it's really blowing, you get 50% off energy. So this is doing a few things. Firstly, it's trying to encourage consumers to engage with this local local generation and change their habits to respond to these sort of Price signals. Pricing. So trying to be responsive to when the energy is being generated. And this is where we're trying to get to with renewable energy generation, flexibility. Secondly, it's it's making consumers benefit directly from these projects.
Max Van Der Lande [00:15:18]:
You know, there's there's when projects have been developed historically. There had been these sort of community funds that sort of get lost in building a tennis court, football pitch, but they don't typically Gets the consumers themselves. That gets the community themselves. Whereas this is saying, if you're with Octopus, you would you would directly benefit in your bill each month. And we're seeing great consumer engagement with this. Really, really fantastic consumer engagement. So there's a massive consumer influx saying, let's build generation where I am. To Okay.
Max Van Der Lande [00:15:46]:
And then we're okay. Brilliant. Okay. Perfect. Got some amazing data on this now. Brilliant. What next? Well, to build a wind turbine, we need some land to to Build a wind turbine on. You can't just sort of magic 1 out of thin air.
Max Van Der Lande [00:16:00]:
And so then we did a sort of something called plots for kilowatts. Okay. We love the catchy names here, Octopus.
Liz Allan [00:16:05]:
You do, don't you? Yeah. So,
Max Van Der Lande [00:16:10]:
what this is is As landowners, we're essentially asked, do you want to have a wind turbine? Do you wanna host a wind turbine on your land, able For you and your community. And we've had an amazing response on that. We've had, I think, maybe 60,000 acres or more, I can't remember, able of land being submitted by farmers, or landowners saying, hey. I'd love to have one here. And so now we've got these 2 brilliant data sources spread over the whole of the UK. And we're like, okay. Okay. So we've got good data.
Max Van Der Lande [00:16:40]:
What what next? We wanna wanna go and build wind turbines. We've gotta find a way we can do it. And I know I've talked about this of to Grid connection issue at length already.
Liz Allan [00:16:48]:
Mhmm.
Max Van Der Lande [00:16:48]:
So that's a big factor. What else is a big factor? Well, we need we need wind, to Obviously.
Liz Allan [00:16:55]:
I knew that. Yeah.
Max Van Der Lande [00:16:57]:
We've got these things. We've got we've got wind. We've got grids. We've got land, and we've got consumer interest. And so, okay, we need to bring these 3 things together. So the projects I've been sort of involved with called called WINDA, wind for Tinder, which is again, it's excellent naming.
Liz Allan [00:17:17]:
Oh my god. I love that.
Max Van Der Lande [00:17:18]:
We've mapped all this data. To beauty along with nature reserves, along with a whole host of difference of data layers. And what we're doing now is using this data to start going, okay. So we've got interest. We've got when. We've got where where where should we start doing this? We've really we we just we strongly believe this is the way it should be done. To It should be consumer led, sort of generation. We aren't we aren't prescribing to anyone.
Max Van Der Lande [00:17:51]:
This is where it's gonna be. We're saying, hey. Do you want it? And that that's that's the right way of Right way of doing it, I think. I love
Liz Allan [00:17:58]:
that. That's and I talk about this a lot on this podcast. We call it the voice of the customer. To And continuous improvement, the work that I do, we call it the voice of the customer because the voice of the customer is so important. And if you just stick your fingers in your ears and go, la la la, I'm not listening, Then that's not the way to be, and you're not doing that. You're doing totally the opposite of that. You're actually going out. Still that sorry.
Liz Allan [00:18:22]:
Win for Tinder just still cracked me up. To oh my god.
Max Van Der Lande [00:18:27]:
We call it a matchmaking service. It's a matchmaking service.
Liz Allan [00:18:30]:
Is, though. It totally is. I love it. I love it. It there's just this is this is in innovation in the with the heart, you know, heart in the right place, isn't it, for Octopus? So so yeah. So So you're getting ready. What what does that mean? What are the next steps then?
Max Van Der Lande [00:18:48]:
Next step is, to As as I sort of mentioned before, we so the this was came out in a press release maybe today or yesterday. So, yeah, there's a there's a there's a consultation for a document called the NPPF or national to Policy, planning policy framework. Okay. Yeah. Catchy title. And then inside this is a very, very long boring document is, to A subsection on wind turbine development and how it should be done and how how planning sort of, planning committees should approach the problem. There is in there a an exam a footnote called Footnote 54, which which is the the famous one. This is the one that basically brings in the ban.
Max Van Der Lande [00:19:25]:
Able it's also called the single objector footnote, where essentially, if 1 person objects to the plan, that really can derail the to Whole sort of development process. Mhmm. So it makes and it really is a single person. We've we've sort of there's a The sort of classic example, which we sort of discussed internally, which rumor has it, there was 1 project, that was trying to be developed, but, 1 local person took to rejection. They couldn't see the project from their property. And so they what they did is they cut down their own hedge Such that they could see the project and therefore object to it. Yahoo. This is really.
Max Van Der Lande [00:20:08]:
Okay. Not in my backyard to take it to the to the degree. And, you know, I'm not saying we should go everywhere, but there there's been this, issue with with this, with this policy. So we're sort of We've been consulting, and we we sort of basically there's there's that part, and there's a few other parts which we're like, these need to change. These really need updating. As that that's the next step. So get get to get English onshore wind because Scotland well have their own planning policies. Right.
Max Van Der Lande [00:20:34]:
Onshore wind unlocked. So hopefully, we can start bringing generation wind turbines Close to demand. Factory well, factories, people, businesses, etcetera.
Liz Allan [00:20:43]:
Yeah. Are you still are you still I suppose to I suppose I suppose you're like you say, you're bringing it nearer to the sort you're bringing the source nearer to the requirement then, aren't you? Exactly. So so I can see. So but have you still got that length of time for National Grid to kinda give you the thumbs up? Here you go. They you've you still got the 10 years?
Max Van Der Lande [00:21:03]:
You still got the 10 years depending on where you're building, depending how big your site is, depending if you're connecting to the national grid or if you're connecting to a to DNO distribution network operator. But, yeah, there's there's still that barrier. And so so not when so we lined to tap our ducks and sort of knocking on the door and trying to trying to sort of solve the problems, bring the walls down 1 at a time. I think I managed to squeeze in 3 or 4 different ways of force there.
Liz Allan [00:21:25]:
Yeah. You did. You didn't put to play spinning the plates.
Max Van Der Lande [00:21:28]:
Spinning the plates. You know? We get the credit a row. Exactly. Exactly. Yeah. One one problem at a time, and we're trying to we're try trying to bring bring the problems down. But, yeah, that's the idea. Bring it bring generation back to back to the demand.
Liz Allan [00:21:41]:
So let's let's talk smart smart tariffs then because that's how we to start talking in the 1st place, wasn't it? Right. And and you talked about max power to start off with. Can you just explain a little bit about it?
Max Van Der Lande [00:21:54]:
Yeah. Of course. So as as I mentioned before, trying to unlock wind is one part, but trying to unlock solar is another part. And there's 2 ways you can approach solar. To So there's utility scale ground mounted, we call it, so building in a field, all this is rooftop. And so what Max Power is trying to to do is trying to expand and unlock rooftop. Now the so step back from that, who has the big roofs? Businesses, to typically Yes. Okay.
Max Van Der Lande [00:22:19]:
So warehouses, factories, etcetera, etcetera, etcetera. And so businesses account for, I think, about 20% of all emissions UK. So quite a big chunk to go and decarbonize. So they're they're a good they're a good target. Now for those who don't know, there's a when when businesses, develop solar. They try and do something where they've optimized, not maximize their installations. And what I mean by that is If you've got if you're, you know, if you're a sun manufacturer, okay, and you've got 1 factory here and, a warehouse over there, you will to Sort of optimized for each individual site. So you'll take your factory.
Max Van Der Lande [00:22:55]:
You'll say, well, my factory uses 10 gigawatt hours a year, whatever, made up number. To And I will basically adjust the size of my solar installation to meet that demand. There's good economics generally for most businesses to go and do this right now, But they won't maximize. So often what this means is they're only installing solar on half a third of their roof space. There like, oh, hang on a second. You've got a brilliant roof here. You're already up there with all the ladders. You're installing the electrical equipment.
Max Van Der Lande [00:23:26]:
To Put a few more solar panels on. Why not? So this is part this is where we're sort of trying to flip
Liz Allan [00:23:33]:
the thinking from optimize
Max Van Der Lande [00:23:34]:
to maximize. And So there's another sort of problem in this. So say this factory, you can put you can put the solar panels on. But say your warehouse has got a really weak roof, to And it can't take the weight of solar panels. So right now, they would just leave that roof empty as they would, and they wouldn't to Put any more on on their factory to meet the demand of the warehouse. So they're 2 separate problems. So what Max Power does, it's trying to bring them together. Okay? And so how to do this? Firstly, it's about a simplification.
Max Van Der Lande [00:24:06]:
If you're a business and you have 50 different sites in your portfolio, 50 different sort of locations in your portfolio, you would get, for each one of them, a range of different numbers representing your your bill. This could be incredibly complex. It could be to 7, 8 different numbers representing your bill. So that could be, you know, your import price. They might sort of spit out what we call your non commodity prices. You'll have things like standing charge, capacity charge, and then a whole range of other other bits thrown on the top. And then if you've got any generation, you'll have an export number as well. So we're talking about, you know, 5, 6, 7 numbers per building.
Max Van Der Lande [00:24:45]:
And if you got a site, sort of portfolio of 50 buildings, you're dealing with to 256 33100, 400 numbers just representing your charges and how you play out. It makes it makes it a problem incredibly complicated for business.
Liz Allan [00:24:59]:
Yeah. Yeah. Yeah.
Max Van Der Lande [00:25:00]:
So what what Max Power does is it's first okay. Oh, this is silly. What we're gonna do is we're gonna take your whole portfolio, to And we're gonna price them altogether. Okay? So by the end of this know, an export, a standing, and a capacity. Four numbers. I think I think most businesses can deal with these four numbers. You know? There's there's a real simplification. I'm like, okay.
Max Van Der Lande [00:25:19]:
That's better. That's easier. Okay. Especially for nontechnical businesses, and that's much easier. Okay. The next part is, well, by doing these businesses together, something really fun happens. Here's the fun part. So if when you have a factory and has demand, to It requires energy and you sign up to Octopus Energy or any other supplier.
Max Van Der Lande [00:25:44]:
What we'll do is we'll go it we'll go away and we'll to buy all your energy in advance. This is called hedging. So you say in the next year, I'm gonna need this energy. I will go to market, and we will go and buy you that energy, and And we'll deliver that then. So the way energy is broken up is into into half an hour blocks. So we'll buy energy in each one of those half an hour blocks to meet your demand. In the same portfolio, you might also be exporting. So you might have some some solar somewhere.
Max Van Der Lande [00:26:11]:
And what we'll do then is we'll go to market, and we will to sell all the energy we anticipate you producing ahead of time. Okay. So the reason this is silly It's because if you are simultaneously exporting and you're simultaneously importing, what you're doing, your net position is far smaller. Able So there's a big crossover there in the middle. And so most of the time, you can do a lot of canceling out, essentially. So octopus doesn't need to go And sell all your energy. It only needs to go sell the energy. You won't meet with your own, export, for with your own generation
Liz Allan [00:26:48]:
Yeah. Yeah. Yeah.
Max Van Der Lande [00:26:49]:
And vice versa. So it it can really reduce the bill on us and reduce the bill on you. So how do I, yeah, that that's sort of the problem. And then I add another layer of complication onto this, to A technical term which we all hate, is something called sleeving. Okay? Sleeving. Okay.
Liz Allan [00:27:08]:
And I have
Max Van Der Lande [00:27:09]:
no idea where the term came from, sleeving. To But we get we get we can talk call it time matching instead, and you you see what I what I mean. So there's a financial arrangement which sort of existed in the market to for a while called sleeping. And what it says is okay. Let me set set set back actually. Here's here's the logic. If you are a homeowner to And you put solar panels on your roof.
Liz Allan [00:27:32]:
Mhmm.
Max Van Der Lande [00:27:32]:
You will use the energy from your solar panels before you start buying energy from the grid. Yes. Okay. Makes sense. Simple. Okay. Now let's see.
Liz Allan [00:27:41]:
Intending to do in the next few months.
Max Van Der Lande [00:27:43]:
Oh, very exciting.
Liz Allan [00:27:44]:
Yeah. Makes a
Max Van Der Lande [00:27:45]:
lot of sense.
Liz Allan [00:27:45]:
To Makes a lot
Max Van Der Lande [00:27:46]:
of sense.
Liz Allan [00:27:46]:
Very simple. With a battery.
Max Van Der Lande [00:27:48]:
With a battery. And now let's say, okay. Hypothetically, you, you don't have space in your roof. So you put them In the field next to your house or Mhmm. Near near your house. You can do something called private wire, which is exactly what it sounds like. You're basically to Taking an extension cable out and plugging yourself in, and then you use use the energy from the solar panels before you import your grid. Okay.
Max Van Der Lande [00:28:09]:
Now let's say These are matters are too far away for an extension cable. What do you do? Well, one thing Octopus can do and some other smart people as well is what we can say this. We will buy the energy from your solar panels. And if you are Importing at your house at the same time, we will sell you that energy you produce back to you. So that's what saving is. It's basically moving the energy from a to b. And what we can do is we can sort of take it we we sort of parse through some costs. So so this is another layer of complications.
Max Van Der Lande [00:28:43]:
It's it's a it's a it's a weird to product. So, hopefully, everyone's everyone's following me.
Liz Allan [00:28:47]:
I'm getting it. I'm getting it.
Max Van Der Lande [00:28:49]:
But yeah. So if there so yeah. So what we do with with sleeving, we won't be charging you what's called a wholesale cost. The actual energy itself, you will be providing yourself.
Liz Allan [00:29:00]:
Of course. To
Max Van Der Lande [00:29:01]:
What we will have to do is have to pass through the costs. So when energy goes through the grid, there are a number of different costs associated that we get levied with from the transmission network, the distribution networks. So that these are these are costs we pass through to the consumer, essentially.
Liz Allan [00:29:21]:
To But the wholesale cost, which
Max Van Der Lande [00:29:21]:
is the largest chunk, gets avoided. So alright. There's a bit of background there. Let's summarize that up. So sleeving, moving energy from a to b, portfolio pricing, all as one, and this hedging situation
Liz Allan [00:29:34]:
Yeah.
Max Van Der Lande [00:29:35]:
Simplified. Max Power brings that all together under one roof, and we say, okay. Bring us your 50 businesses. We will forecast your demand, your generation, and able And therefore, forecast your net position, your export generation different export demand difference. And we will give you five simple numbers. Your to Your import, your export, your standing charge, your capacity charge, and a sleeved rate a sleeved rate. So a cost For moving energy from a to b. Yeah.
Max Van Der Lande [00:30:05]:
Some numbers out the air, the sleeve rate is about a third of the price of importing energy off the grid at the moment, about a third of the price. What about to kilowatt hour. This changes portfolio to portfolio. This changes site to site. But 10 p. So very, very low rate. So This is doing 2 things. Three things.
Max Van Der Lande [00:30:25]:
It's making it's making, businesses save some money, which is good. Okay? It's also making the economics of solar work better. Mhmm. So what I mean by that is For business, if their solar panels are exporting, they're earning some money, a little bit
Liz Allan [00:30:45]:
of money. Yeah.
Max Van Der Lande [00:30:47]:
But if their solar panels are to Leaving, they're saving even more money. Okay? So it's making the economics, making the finances of putting solar on better. And then thirdly, it's now coming back to this maximize not optimized problem. It's saying, well, let's not just put solar panels on half the roof with that factory warehouse example. Let's fill the roof on the factory so the warehouse can make use of the energy as well. So that's that's what's going on here. We're doing that on a portfolio level and hopefully unlocking and encouraging renewable generation, for businesses. That's the idea.
Liz Allan [00:31:22]:
Oh, these clever things. Goodness me. And and that's what so you're involved in that and the, and the wind and the wind farm projects as well, aren't you?
Max Van Der Lande [00:31:32]:
Yeah. So I still wear a few different hats. But, yeah, that's so this this project right now is sort of to Getting off the ground. We've sort of starting our pilot on it where we started the pilot. We started the pilot, and so hopefully, we'll get some sort of early results quite quickly. Able Yeah. So I've wear a few different hats. It's sort of that that's the fun of Octopus.
Max Van Der Lande [00:31:49]:
We we do lots of lots of things, and it gives you a lot of opportunity.
Liz Allan [00:31:53]:
We were talking very briefly, weren't we, before we started recording about kind of the different tariffs, the as a as a kind of as a homeowner and specifically somebody like us who are so we're we're also you know, we're looking at solar and battery, and we're also looking at an EV. So so you were talking about, a tariff for for EV drivers, weren't you?
Max Van Der Lande [00:32:17]:
Yeah. Yeah. So we Octopus is obviously a whole range of really amazing energy products. And so for the best the best product for you, I recommend going to the web site and doing some research. But a really cool product, which we use of, Launched fairly recently. It's something called intelligent octopus. Mhmm. And now what this is is it's it's well, firstly, very smart and very complicated, so I'm not gonna do it to.
Max Van Der Lande [00:32:38]:
Secondly, what it does is for EV drivers, and it's controlling when we charge your car.
Liz Allan [00:32:44]:
Mhmm.
Max Van Der Lande [00:32:44]:
There's a lot of parameters to do that. But, essentially, you tell us when how much charge you need and when for. So you might say, well, for 7 AM, I want to 60% of my battery to be charged because that does my commute, and I don't wanna overcharge because it's not good for the battery. Yeah. I guess it's 60%. What we then do Is we collect all your data. Sorry. We collect all the data on lots of different drivers.
Max Van Der Lande [00:33:08]:
We collate, you know, thousands of drivers, to And we can sort of group them together in a way that means we can sort of do group action. So there's a there's a funny term here called VPP, which is Virtual power plant. And what this means is we can just change how much demand you have as a group. And this is a really great service for DNOs, to district, distribution network operators, and there's also the National Grid hopefully down the line. And it can basically relieve constraints. If we get told, you know, able Oh, no. Okay. So in the southeast, we've got really big constraints.
Max Van Der Lande [00:33:42]:
Can you guys chill out on the charging? What we'll do is we'll just ease up on on the vehicles that to So say you have to charge your car, we won't be pausing that. But say your car's at 55%, we've got to get 60 for the morning, we'll slow down the charging to Or stop. And then we'll resume it when it's suitable. And so what this does is it generates a sort of to It's a very, very early market. That's very nascent, very, very sort of immature market. But what it does, it means we can get some revenues in, to And we can pass these through to the consumers. So not only are you charging at night when it's cheap, but you're also sort of doing this sort of group behavior Where we can help the grid and help the operators manage this demand. So it's really exciting.
Max Van Der Lande [00:34:25]:
And, so it's it's a collaborative project to From from multiple teams this, but sort of lots of the brains sit with a part of the business called Kraken Flex, which are are sort of Braids of the business. They're the they're the really smart guys. The people who do Kraken with
Liz Allan [00:34:39]:
a k. Is that is that Kraken with a k? Yeah. Yeah. Yeah. I've seen Kraken. Yeah.
Max Van Der Lande [00:34:43]:
They did they did lots of smart stuff about controlling batteries on a grid scale, and doing lots of lots of stuff like that. And to And they're applying this to the really smart utility scale thinking down to consumers now. And so the consumers are now acting as these big businesses and benefiting from That's where we're going. That's the direction of the of the market. Every consumer should feel empowered and and benefit directly. Absolutely. Brilliant idea. Absolutely.
Max Van Der Lande [00:35:11]:
And what about because we also talked
Liz Allan [00:35:13]:
about so you've also got another tariff, Which is also you said it was a a tri band tariff. Was that right?
Max Van Der Lande [00:35:20]:
So we've got a really new tariff. This one's targeted at so you mentioned already that you've got, solar panels to And your your your your battery. So we've just, launched. And, again, I'm not involved in this project, but it seems like a really exciting one. Able Something called Octopus Flux, f l x, Octopus Flux. So this product is specifically designed for people with batteries and solar, And it basically unlocks cheap energy for them, in a in sort of a repeatable, reliable way. To And
Liz Allan [00:35:53]:
the way it does this is through
Max Van Der Lande [00:35:53]:
something called tri band. Tri, 3, bands, band, I suppose. To 3 3 3 people at 3 prices, is what about. And the way that works is in the evening peak when Everyone's switching on their kettles, coming home, cooking their dinner. Electricity prices are high, and we have to reflect that. The price in this tri band is high then. But then you get down to the evening, and the prices drop down to a sort of real low bottom in the middle of the night, super cheap. This is when you should be charging your battery.
Max Van Der Lande [00:36:23]:
Essentially, this is when you sort of import from the grid, charge your battery if your solar panels haven't already done it.
Liz Allan [00:36:27]:
Yes. Yes.
Max Van Der Lande [00:36:28]:
And then we sort of have that sort of Normal middle of the day sort of behavior, where it's sort of in the middle, really, really, really good, really good price. So you can sort of charge your batteries with your, able with your solar panels or you can export to the grid. So that's that's our Octopus Flux sort of offering as well.
Liz Allan [00:36:45]:
That's really good. You've Given me loads of things to think of as well, and and I think probably everybody who's who's listening, this, you know, to achieve this. This is kinda given a really good overview of what you're trying to do at octopus and compared you know, I mean, I don't know many other energy companies. I did work for 1, but they're on the telecom side some time ago. But but that's that's really interesting interesting to kind of, to understand. Able So so final question. Obviously, I saw you on I saw you on LinkedIn. It Is is LinkedIn a good place for people to kind of spot you if they wanna if they want wanna kinda connect with you?
Max Van Der Lande [00:37:28]:
Absolutely. LinkedIn's a really, really great way. LinkedIn's LinkedIn's perfect. I always always always go through my messages and try and respond as timely as possible. But, yeah, LinkedIn's a great way.
Liz Allan [00:37:37]:
Brilliant. And what about what about if people are actually looking where's the best place to look on the Octopus website for for kind of in information about tariffs?
Max Van Der Lande [00:37:55]:
Of our website as well. So flick through there, see what's going on. But, no, we we've got a really informed informed website. And the way we sort of structure it is, there's to So the central hub where you go to the tariffs, and then that link you through to a tariff specific web page. And then if you just click through again, there's usually a blog. So is this for example, this applies to Max Power. It's a blog, which it goes into the raw detail so you can really understand what you're sort of signing up to and how it works.
Liz Allan [00:38:20]:
To Oh, that's fantastic. Oh, you've been do you know what? You've been it's been really interesting talking to you, and you've made a lot of a lot of things that I didn't have a clue about really interesting and kind of you know it it's just you've kind of broken it down into chunks which is great so so to listen. On that point, I'm gonna say thank you ever so much for your time, Max. It's been brilliant. I'm sure there'll be times that we're gonna bump into each other in future, and I'd love to to grab you and get you back on again. But for today, I will say thank you ever so much, and I'm gonna say goodbye to everybody else. See you later. Bye.
Liz Allan [00:38:56]:
You've been watching Electric Evolution with Liz Allen. Don't forget to subscribe and click on the bell icon, and you'll receive all of our weekly videos. Thanks for watching. See you soon. Bye.