Ofgem has approved a £6 million investment into a digital marketplace for energy.
SP Energy Networks’ Project Fusion platform will allow people to trade surplus power with their energy supplier and other consumers and through doing so, secure additional income.
It says this would reduce the amount of money needed to build new grid networks to support electric vehicles, local electricity generation and heat-pumps.
The flexible project will enter its five-year period of operations this month – the firm says if it was implemented across the UK, it could save £200 million in electricity bills by 2050.
It will be trialled in East Fife, an area with a diverse range of energy resources, including onshore and offshore wind and hydrogen storage.
Project partners include Fife Council, the University of St Andrews and Imperial College London
CEO of SP Energy Networks, Frank Mitchell, said: “The project is at the heart of making more effective use of existing electricity infrastructure and ensuring we keep customers’ bills down and their lights on.
“This is critical as we move towards an electric future in the transport and heat sectors to meet the challenges of climate change and make our society cleaner and greener.”