UK consumers could save billions of pounds on their energy bills thanks to new technology changing the way power is used and stored.
The Government has unveiled plans to introduce new rules to help householders use energy when it is cheapest, receive money for returning power to the grid and store energy in batteries.
The suggestions include measures to help develop smart appliances which respond to energy prices, such as washing machines that come on at off-peak times when power is cheaper.
Analysis suggests that deploying "flexible technologies" including batteries and smart grids could save the UK energy system between £17 billion and £40 billion by 2050.
The Government regulator Ofgem and the industry are rolling out smart meters and will bring in "smart tariffs" for consumers to pay less for off-peak power.
The rules, due to come into effect over the next year, will also help people with solar panels generate and store their own electricity and sell it back to the grid.
They also outline plans for standards for electric vehicle charging points so consumers can charge their cars when demand is low and be paid for feeding power from cars back to the grid.
Examples of new technological developments which are already being trialled include Nissan looking at ways electric vehicles can be used as a "virtual power plant" when plugged in to supply the grid.
British company Moixa is paying households £50 a year for deploying home batteries, which help manage electricity demand on the network by charging up when there is surplus power on the grid and exporting it when demand is high.
Business and Energy Secretary Greg Clark said: "Upgrading our energy system to make sure it is fit for the future is a key part of our Industrial Strategy.
"A smarter energy system will create opportunities to reduce energy costs, increase productivity and put UK businesses in a leading position to export smart energy technology and services to the rest of the world."
Andrew Wright, senior partner, energy systems at Ofgem, said: "We want to open the door to new technologies and services so that they can help to reduce bills for consumers in the long term.
"It is vital that we get the changes in place as there is potential for a smarter system to save consumers billions between now and 2050."
Additional reporting by Press Association.