Energy consumption of households is not evenly distributed. To satisfy peak demand, additional CO 2 intensive generators are turned on when demand peaks. To avoid peak demand from dwellings, the RED WoLF (Rethink Electricity Distribution Without Load Following) hybrid storage system is proposed, consisting of batteries, storage heaters and a water cylinder. This aims at avoiding the use of these peak generators and integrating a higher share of renewables on the Power Grid. This system is planned to be tested in 100 houses distributed in 6 pilot sites in Great Britain, Ireland and France, which are currently undergoing construction or refurbishment. This study presents the theoretical model of the controlling algorithm, which enables the uptake of Grid electricity only when CO 2 intensity is below a dynamically computed threshold. The algorithm is tested in computer simulations over the four seasons with varying size of batteries and photovoltaic arrays. Results show how RED WoLF algorithm satisfies households demands while, at the same time, successfully avoiding domestic peak demand, with a significant drop of CO 2 emissions. This is achieved by both increasing photovoltaic self-consumption and uptake of low carbon Grid energy. For example, with a 7 kWh battery and a 4 kW photovoltaic array, CO 2 emissions drop by 30% to almost 100%, depending on the season, relative to the same house without the RED WoLF system. The system has the potential to shift residential demand from peak power/peak times to low value electricity at a time of low demand.