Do you fill up on the way to work, during the school run or on bank holidays? If you do, then you’re likely to start paying an average of £1 more per fill up very soon.
Artificial intelligence systems equipped with the ability to charge customers depending on location, demand and even the particular driver have arrived in the UK. They will be used by fuel retailers to make more money from customers who choose to fill up at the busiest times.
The tech comes from Denmark-based a2i Systems. The company is in late-stage talks with petrol retailers in the UK. If all proceeds as expected, the technology will be installed into forecourts within months. One of the leading supermarket brands is close to signing an agreement and will likely be the first to launch.
The new technology could lead to prices shifting several times over the course of a day, with a rise or fall of over 2p per litre (amounting to £1 a tank). The technology is already being used in most petrol stations in the US and Europe, where it is normal for prices to change up to ten times a day.
For those interested, the computer algorithm is modelled on the human brain. It scours databases of customer information to predict how they will behave. If it sees the station is having a busy period, then it will hike prices accordingly, in much the same way that Uber increases the cost of its fares to take advantage of high demand.
Similarly, in quiet periods it could drop prices to entice more customers in. In theory, this could mean that savvy customers who can predict the cheaper times of day for prices could fill up for much less than they are paying currently.
The ones caught out will be those left with no option but to fill up at the busiest times, such as during rush hour or on bank holidays.
Industry experts have mixed views about the new technology and the effect it could have on pricing. Luke Bodset from The AA commented,
“This represents a huge change which would be most unfair on commuters and families. It will wind them up no end as they will become wise to the fact that retailers can exploit price movements.”
PetrolPrices.com’s Jason Lloyd believes that,
“The UK has been behind the rest of the world on dynamic fuel pricing for years, so to hear that a supermarket is planning to do this may trigger the rest of the UK petrol retail market to follow.”
Smart pump pricing will both benefit drivers and frustrate in equal measure, but the logic behind it means that if you are smart about when you buy fuel, you can save money, while those who fill up in peak demand periods will pay more.
It will be interesting for PetrolPrices.com to try to make price comparisons once this type of technology has been implemented. However, we will remain committed to providing our members with an impartial source of price information. The new technology won’t affect that. We’ll let you know which providers are using smart pumps, so you know to expect a fluctuation of around 2 pence every day. As ever, our advice remains the same: use our service to compare prices and ensure you always get the best deals at any time.
Do you agree that these changes to pricing will be unfair to UK motorists in peak driving times, or do you see it as an opportunity to save money? Let us know in the comments below.