For many people contemplating producing their own electricity supply by micro-generation, part of the attraction is the possibility of exporting any surplus to the national grid.
Whether you’re planning on installing a wind turbine or adding photovoltaic solar panels to your roof, if you have an existing grid connection, it can certainly seem a tempting prospect, but what exactly is involved?
The National Grid
Confusingly, exporting electricity to the grid does not actually involve selling it to the National Grid itself – one of the largest utilities in the world, which owns the high-voltage transmission system in England and Wales and operates the system across Britain.
Instead, supplying the grid with surplus power requires you to sell it to a utility company – which now are being required to obtain at least 10 per cent of their electricity supply from renewable, sustainable sources. As a result, if your house already has a connection to the national grid, you can sell the surplus electricity generated back to your energy supplier – although there are conditions and some bits of red-tape attached.
Selling Your Electricity
There are two main ways to go about exporting your renewable electricity – via flat-rate generating payments or net metering arrangements.
If your micro-generation system is fairly small and largely intended to help supplement your own energy needs rather than expected to produce a significant surplus, the flat-rate payment option – which pays a small sum for each unit generated – is probably the best way to go.
Although the unit price is quite low, the advantage of this system is that you get paid for generating the power – it doesn’t matter if you use it yourself or it ends up entering the grid as surplus to your own requirements.
The different utility companies which offer this kind of arrangement have their terms but generally, you supply your generation meter readings – and all domestic micro-generation installations should have one of these fitted as standard – and they work out the rest.
Alternatively, if your home generation system is likely to produce more electricity supply than you need yourself, it is probably worth looking into a net metering arrangement. This will provide a higher price for each unit of electricity generated over and above your household’s own needs – but you’ll need to get a properly approved export meter in addition, to measure your surplus generation output.
Renewable Obligation Certificates
The Renewable Obligation scheme is the main support for sustainable energy in the UK, ensuring that utility companies have to source a proportion of their electricity supply from renewable generation. Part of this mechanism involves the issuing of a Renewable Obligation Certificate (ROC) to authorised generators for every megawatt hour (MWh) of electricity produced by renewable means.
These certificates – which micro-generation projects are eligible to receive, if they satisfy the necessary conditions – can be sold to utility companies which lack sufficient green generating capacity themselves to enable them to meet their renewable requirements. The current market value is around £40 apiece, making them a useful potential addition to the revenue stream for a small-scale installation.
However, it is important to realise that the arrangement offered by some energy providers for buying your electricity may include assuming ownership of your ROC entitlement. Typically, if you opt for a flat rate payment option, you will not be able to also claim your ROCs, while net metering usually allows you to still obtain certificates and trade them.
Before signing up to any deal it is obviously essential to make sure of these details – not least because both the market and legislation can often be subject to change.
In the end, the decision to go ahead with any form of micro-generation – either for your own home or as part of a community scheme – is almost always going to come down to whether or not it meets your own needs, in terms of energy-demand and/or eco-conscience. If it also lets you do your bit for “greening” the national grid, then that’s a definite bonus.