From the 1st January 2020, the Smart Export Guarantee (SEG) requires energy suppliers with more than 150,000 domestic customers to offer at least one export tariff to small scale electricity generators, which includes Solar, Wind Turbines, Hydroelectric and Anaerobic systems. It will ensure forms of renewable energy generation with a capacity up to 5MW will be paid for each unit of electricity they sell to the grid – tracked by a smart meter.
The Smart Export Guarantee replaces the Feed in Tariff (FiT) and removes the subsidy for new schemes away from Electricity bill payers, to a tariff which reflects the commercial value of the energy being exported to the network.
The FiT scheme, launched in 2010, offering guaranteed cash payments to households and businesses who produce their own electricity using “microgeneration” technology under 5MW. FiTs also provide payments for any exported power. Existing FiT arrangements will continue for their contract term.
Although the SEG is effective in 2020, some energy suppliers have offered tariffs early to capture those schemes which missed the FIT closure deadline of 31st March 2019 and not received payments.
The only restriction on the new tariff, is that it needs to be greater than zero p/kWh, although should prices be too low, there could be government intervention. OFGEM will be reporting on the scheme. In order to qualify for SEG, the generator needs to be certified under the Microgeneration Certification Scheme (MCS) or equivalent, to have a smart meter that records Half Hourly export consumption and not already be within the FiT scheme.
There is an opportunity for suppliers to offer innovation, rewarding customers who store and export at times of peak demand and greatest financial reward. If some of the storage comes from the grid, this would likely restrict access to some Green tariffs.
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