Tempus was established to exploit a disruptive technology and business model to create efficiency savings across the electricity supply chain, and pass those savings onto customers. We want all electricity users to benefit directly from electricity cost savings while reducing their carbon footprint.
What we do
We use a technology and trading methodology called Demand Flexibility to get the most out of renewable power when it is plentiful and cheap. Demand Flexibility means we help consumers and businesses to shift their energy demand to times of the day when energy is less expensive. Most people are familiar with peak and off-peak energy bills (where electricity is cheaper at night) but Tempus can trade energy in much tighter windows and, crucially, when there is lots of renewable energy on the system. This reduces the need to purchase expensive, fossil-fuel “peaking” power. At times of high demand, fossil fuel power stations that can start very quickly start delivering power to the grid. These are known as peaking plant as they deal with peaks. They are the most carbon intensive electricity generation and create a great deal of pollution. We know they also ramp up energy bills because they lie dormant until needed, then sell power at peak-time prices. Most customers have no choice to accept this, until now. Tempus wholly owns an electricity supply company, which combines Tempus technology and demand-management to create “flexible customers”. Flexible customers will save money, both directly through lower wholesale prices, and indirectly because Demand Flexibility reduces network costs and helps renewable generators to operate without public subsidies.The technology and system can be licensed to other suppliers in the UK and across the globe in the future, to help their own customers become flexible. We believe that our commercial approach to climate change resolution, which decarbonises electricity supply in a way that brings down costs rather than increasing them, is a gamechanger for the smart energy revolution.
Our Technology
Our bespoke technology enables us to manage electricity market prices to match customers with the best available price at all times. It’s all automated, so Tempus Customers can sit back and relax as their bills fall.
We use algorithms to work out the best times to use electricity from a price point of view and smart equipment like smart meters, sensor and control technology which is sometimes found in building management systems and sometimes implemented by our technology partners. This means we can automatically shift customers’ electricity usage away from expensive times and into periods when prices are lower, such as during the night or times when renewable generation is very active.
Our IP company Tempus Energy Ltd has applied for a green, fast track patent to protect our invention and ideas.
By moving customers’ flexible demand to cheaper price periods, we lower the cost to us of buying electricity and therefore we can sell to customers at a lower price. Unlike other new entrants we are striving to do something different; we move electricity demand using sensor and control technology and we settle all customers based on their actual consumption. We believe our technology gives us a real competitive edge through innovation which is how we create value.
The underlying technology we use to move demand is not new, this demand response technology has been keeping the lights on for years by providing service to National Grid in this country and multiple system operators across many States in the US. We are simply combining this technology with our own cost-optimisation platform to extract more value from the total electricity value chain. We pass this value on to customers in the form of lower electricity bills.
The Future
Once we have demonstrated the business model in the UK, we plan to rapidly expand to other international markets commencing with Scandinavia and the US. We have chosen these markets because they are both characterised by high levels of liquidity meaning that it is possible to buy electricity in a competitive market. Plentiful intermittent renewable energy in Scandinavia particularly has meant that electricity prices are much more likely to change during the day offering more opportunity for flexible customers to benefit from lower prices.
In the UK our supply company has already started to sign up customers and once we complete the formal regulated market entry process we aim to switch these customers to be supplied by us. We expect rapid customer acquisition through a combination of our third party ecosystem technology partners and through partnerships with industry bodies that will assist their members to access lower electricity bills.
We are raising money to fund our operation as both an electricity supplier and technology company. We expect to receive our first customer revenue in April and are forecasted to become profitable in 2016.
The electricity value chain in the UK appears complicated to an outsider and is made up of electricity generation that is transmitted via a high voltage network to grid supply points that connect to the lower voltage electricity distribution network and ultimately deliver electricity to customers. The relationship with the customer is managed by the electricity supplier. The component parts of this system are replicated in all electricity systems across the world.
Electricity System
Electrical power is different to other commodities. It is difficult to store and must be generated and consumed in real-time, on an instantaneous and continuous basis, otherwise blackouts occur. Moreover demand for electricity cannot be fixed on a long-term basis, as it is unpredictable and dependent on factors such as the weather.
Generators do not deliver power directly to the suppliers with whom they have contracted, or the customers of those suppliers. Instead, electricity must be delivered onto the national transmission network, then conveyed to local distribution networks before finally reaching customers’ premises. Once electricity is passing through the networks, it is indivisible from that generated by other parties and is delivered indiscriminately to wherever there is demand.
Flexible Demand
Balancing the system through customer’s flexible demand rather than by increasing baseload generation also avoids the problem of transmission losses (a certain amount of electricity is always wasted when it is conveyed over long distances). It also eases congestion on the network which, in the longer term means that the network does not need costly reinforcements. This is positive news for customers, but not for shareholders of electricity generation and network companies, who want to see their asset base grow over time rather than diminishing in importance.
Customers’ flexible demand is a cheaper and greener balancing tool than fossil fuel generation, but it is a threat to the business models of the incumbency, because customers who have not previously been able to manage electricity demand will now be helped to do so and by reducing peak demand, this will reduce the prices paid to electricity generating companies at peak times. We believe Tempus is the first GB electricity supplier to offer an electricity tariff that values flexibility to all flexible customers, regardless of size.
Regulatory Change
The UK has been undergoing regulatory change that will create more variation in electricity prices which we believe in turn will offer more opportunities for Tempus to extract value. These changes include Ofgem’s Smarter Markets reform program and the Electricity Balancing Significant Code Review. From April 2015 all networks will be regulated under a new RIIO (Revenue = Incentives + Innovation + Outputs) framework that values innovation. Many of the costs on electricity bills are difficult to understand. One of these costs is what we pay to keep the whole electricity system balanced so we don’t have a blackout. National Grid is currently responsible for balancing the grid as part of their electricity licence obligations. Suppliers could reduce these costs by using customers’ flexible demand. This is what Ofgem would like them to do and this is why Ofgem is reforming these costs to make it more expensive for suppliers to not balance supply and demand. From November 2015 under the Electricity Balancing Significant Code Review, these new costs will be implemented. Tempus will use our technology to balance in a way that benefits customers by reducing these costs. We see all this regulatory change as a positive opportunity for Tempus and further enhances our ability to extract value from the system.
How we fit in
We believe our technology and approach is unique and that we will be one of the first electricity suppliers in the world that disaggregates the fossil fuel generation business model on behalf of customers putting them in a position of control for the first time much like Uber has disaggregated the taxi industry giving customers greater competition on price. We think this ground breaking approach and technology will threaten the incumbent electricity companies because we will be competing aggressively on price. We have a comprehensive media strategy to combat any adverse publicity motivated by commercial self interest that seeks to invalidate our approach.
Chris Nash – Chairman
-Serial chairman and non-executive director focusing on clean technology businesses
-Has taken several companies from start-up to successful revenue creation
Sara Bell – CEO & Founder
-Previously responsible for developing UK Power Networks’ commercial strategy for future distribution network management and operation
-Has held roles as Executive Director of the UK Demand Response Association, a Trustee of Sustainability First, sits on the National Physical Laboratory Centre for Carbon Measurement Advisory Board, and is a former member of the Singapore Government Climate Change Committee R&D workgroup
Ilse Dubois – Head of Sales & Marketing
-Experienced business developer in energy innovation with a strong technical background
-Previous roles include Head of Sales and Business Development Director at Utilyx and Regional Director of EnerNOC UK, a demand response aggregator
-Holds a Master in Electro-Mechanical Engineering with specialization in HVAC, and fluent in four languages
Nick Butlin – Head of Operations & IT
-Previously Director of Operations and Technology for KiWi Power at the heart of pioneering demand side aggregation
-Experience in technology innovation and development, business and market modelling, and electricity market policy development
-We are confident that Nick’s experience in smart energy projects will be of great value to Tempus
Andrew Perry – Head of International Strategy & Funding
-Previous roles include being the Principal heading up the Market and Policy Development section at DNV GL Energy and before that Head of Electricity System Strategy at DECC
-We are confident that Andrew’s understanding of the energy industry (including Smart Energy developments) and experience in strategic consulting will be of great benefit to Tempus.
Sophie Yule – General Counsel
-Energy and competition lawyer, specialising in the development and reform of regulatory frameworks
-Previously in private practice at the City law firm Watson, Farley & Williams LLP, advising renewable generation developers and investors on regulatory risk
-4 years in the UK Government’s Department of Energy and Climate Change, drafting legislation for low carbon energy markets
Abhishek Jain – Finance Director
-Holds a Masters in Finance from LBS and awaiting Charter (passed all CFA exams)
-Background in trading where he led a team of traders designing the roadmap to establish a rates trading desk