From 31 December, suppliers with over 150,000 customers will have an obligation to offer an export tariff for customers who install solar, wind, anaerobic digestion or hydro generation with a capacity up to 5MW. The obligation also includes micro CHP with an electrical capacity of up to 50kW. Suppliers will also be able to offer other export tariffs and buy power from ‘more complex systems’, which could include storage and non-renewable energy, provided they are co-located with an SEG installation.
BEIS did not set a minim tariff but will require suppliers yearly on progress and the uptake of tariffs.
BEIS said the so-called Smart Export Guarantee (SEG) would encouraging suppliers to competitively bid for electricity. Smaller suppliers may offer tariffs but suppliers will also have responsibilty for ensuring the safety of the installations and in the case of AD, making sure the fuel meets sustainability criteria.
BEIS said it was also keen to support households and businesses in being able to store energy in batteries in their homes, which consumers will monitor on their smart meters, respond to price signals and choose the most economical times to charge their electric cars and sell their electricity back to the grid.
Energy and Clean Growth Minister Chris Skidmore, said: “The future of energy is local and the new smart export guarantee will ensure households that choose to become green energy generators will be guaranteed a payment for electricity supplied to the grid. We want the energy market to innovate and it’s encouraging to see some suppliers already offering competitive export tariffs to reduce bills. We want more to follow suit, encouraging small-scale generation without adding to consumer bills.”
The implementation date coulld leave a gap for users: the previous Feed-in Tariffs scheme closed to new entrants on 31 March. But BEIS highlighted suppliers Octopus and Bulb, who already offer such export tariffs.
Ben Gatley, head of energy trading at Social Energy, which offers battery storage and a 5.6p per kWh export tariff, said the guarantee was “nothing to celebrate” as it did not offer the rate of return of FITs. He said, “…as more solar adopters embrace smart battery storage, even less will be so dependent on the Smart Export Guarantee. My message today for anyone considering adopting solar is to not be put off by the SEG base rate, as there are better ways to guarantee a return on your investment than simply selling your energy back to the grid – smart battery storage is the future and is ready to be embraced.”
Legislation will be laid in Parliament today (10 June).
Currently Avro Energy, Bulb, Centrica, Co-Operative Energy, E.On, EDF Energy, Electricity Plus, ScottishPower, Octopus Energy, OVO, Npower, Shell Energy, SSE and Utilita each have over 150,000 customer accounts