Export Tariff - "Opting Out" - Can I keep my own energy please?

Cardew

HappyMJ wrote: »

In the long run it's a good thing as we don't need as many coal-fired, gas-fired or nuclear power stations to be built.

Whilst I agree with most of your post, the above statement is incorrect!!

The peak demand in Britain is always early evening in winter. At this time the output from solar PV is zero/zilch/nothing.

So we must have the same conventional(incl nuclear) generating capacity (e.g. coal-fired, gas-fired or nuclear power stations) , to meet that demand regardless of the solar generating capacity in Britain.

The same applies to Wind generation as sometime the wind ain't blowing!

ClaimYourEnergy

Cardew wrote: »

Some companies do not have to participate in the FIT payment scheme. Also you can get your electricity from, say BG and, say EON deal with your FIT payments and exported electricity.

So take this scenario with BG supplying electricity and EON dealing with FIT. You produce 3,200kWh pa, from your PV system and use 25%(800kWh) in your house and you need a further 2,000kWh PA from the mains which is supplied by BG.(your annual consumption is thus 2,800kWh)

Under your proposal your meter will run backwards 2,400kWh(3,200 - 800kWh).

So BG have supplied you with 2,000kWh, but your meter has run back 2,400kWh. So for supplying you with 2,000kWh BG have to charge you nothing and indeed give you a rebate for 400kWh!!!!!!

So you get:

1. 800kWh of 'free' electricity from your panels.

2. EON gives you 3,200 x 43.3p + 1,600 x 3.1p.

3. BG give you 2,000kWh of free electricity plus a rebate for 400kWh i.e. You derive an income from BG!

Hi Cardew,

Mixing the companies who supply the "feed in" versus the supplier who supplies the "usage" would complicate matters, I concur. And this may be the best reason I have heard to date for the way they have arranged the system. However, I still believe that this arrangement should NOT penalise the consumer and will explain how it can work below.

In your example there is also the added difficulty of a person generating more than they use, which I think is rather unusual, but I cannot ignore the possibility and will work with that in mind as well.

OK, let me look at this from the angle you have presented and offer a solution that would work fair for all concerned. After all, I am not trying to argue a way to fiddle the energy providers, but to ensure the consumer is paid what they deserve.

OK, after some thought, I can see two hurdles that need addressing:-

1) The consumer protected for the energy they generate.
2) The provider correctly paid for their supply.

The first part is easily answered and would be that it was the responsibility of EON to pay the consumer 3.1 p x 400 KWh as agreed for any excess energy generated by the consumer. (They would also pay the generation tariff, but this is covered by the government anyway, so no loss there.) EON would be happy, because they could sell the cheap energy at their normal cost. And the consumer would be happy because they get their Export Tariff.

The second part next: I understand that their is a "Central Register" that records who supplies the feed in tariff. Now, as EON are tracking you Exported amount, they will record an Export value of 3200 - 800 = 2400 KWh. (2400 units.) Now, as you rightly say, BG are owed 2000 of this recorded Export value. However, as long as the electricity companies are co-operating with each other, they can negotiate the payments between themselves via the central register. At the end of the day, the Export value has been recorded officially and accurately via EON and they now simply need to make the correct payments to the correct parties in question. (As there could be various payments required between different suppliers, then it would be easy enough to just find one simple difference.)

If this was the only arrangement between the two companies (which it obviusly would not be, but will will assume so for simple maths), this would mean EON would arrange payment with BG for the 2000 units and the 400 units with you, the consumer. You (the consumer) have already signed a contract saying you accept 3.1 p per unit, so that is easy for EON. The two companies (EON & BG) would no doubt come to some other arrangement and make deals not unlike they do at the moment when arranging supplies of their energy to distribute to the domestic market. As it would be swings and roundabouts for the companies, they would come to some arrangement where they would NOT lose out in any way.

So, as you can see, even this rather complicated example that you give can be worked out fairly for all concerned:-

1) EON receive 2400 exported units.
2) BG supply you 2000 units.
3) BG claim 2000 units worth of payment used by you from EON.
4) EON "pay" BG the units they provided you out of the Exported energy you supplied.
5) EON pay you the remainder in an Export Tariff.

This would be fair all around.

Also, please note: Ultimately, I am NOT arguing for backward meters, BUT fair payment of energy provided. Backward meters is the simplest solution if you are with the same supplier for both feed in tariffs and usage. However, if another meter that records proper generated to usage becomes available, then I am fine with that too.

The point is, as it currently stands, the electricty companies are gaining from the energy you create, but as I have shown, these "issues" can be addressed and people properly paid for what they generate.

CYE

HappyMJ

Cardew wrote: »

Whilst I agree with most of your post, the above statement is incorrect!!

The peak demand in Britain is always early evening in winter. At this time the output from solar PV is zero/zilch/nothing.

So we must have the same conventional(incl nuclear) generating capacity (e.g. coal-fired, gas-fired or nuclear power stations) , to meet that demand regardless of the solar generating capacity in Britain.

The same applies to Wind generation as sometime the wind ain't blowing!

So the point of solar generation is what exactly? I always thought it saved at least 1 power station from being built...Maybe not..I never understood wind power myself.

DVardysShadow

ClaimYourEnergy wrote: »

... If you generate 4000 KWh and end up using 4000 KWh in the same year, why should you pay more for your energy? Just because you generate it at a different rate of using it, as long as it balances out in the course of a year, why can't you use what you generate for free? i.e. You generate 4000 KWh and use 4000 KWh in a year - zero owing! Do you agree with this?

I fundamentally disagree with this. The price of energy is not fixed. Not even through the day. This is so that supplies are used cheapest first.

Your solar electricity is only available when the sun shines on you. But your energy is always accepted by the grid - whereas power stations can have their offers to supply turned down virtually minute by minute to match demand. So if you generate when you want, your electricity has to be the cheapest on the grid. You have to undercut all of the other suppliers. But when you want to use your electricity, you are effectively demanding another kWh from the most expensive power station on the grid to get back the kWh you sold so cheaply during the day.

So your kWh that you effectively banked with the network costs you the difference between your kWh selling rate when you supply and the buying rate of the most expensive kWh when you consume.

Additionally, your kWh probably turns into 0.85kWh by the time it is used, because of network losses - and to get back your kWh, 1.15kWh has to be put on the grid.

So the question is: whether selling 1kWh for the value of the cheapest 0.85kWh on the grid and buying back 1kWh for the price of the most expensive 1.15kWh on the grid is cheaper than just buying your 1kWh when you want it.

ClaimYourEnergy

HappyMJ wrote: »

It's all in the legislation. It'll take quite a bit of reading and understanding but the energy suppliers are obliged to pay for the energy generated from your solar system. They have to raise the money from somewhere and they add it to the per unit rate on all consumers. The government does not pay for it (as you seem to believe)....and even if they did then they would have to raise the money from somewhere and that would be on taxes on everybody so everyone who does not have a solar system is paying you for the energy you generate. In the long run it's a good thing as we don't need as many coal-fired, gas-fired or nuclear power stations to be built.

There is no architecture already in place to store excess capacity. If too much energy is generated then is goes unused...into the ether..that's a reason why E7 night rates are so cheap. The night rates are cheap to encourage people to use energy at night as they physically cannot turn off a power station at night the power stations must run 24 hours a day at full capacity. A coal fired or nuclear power station takes 24 hours to start from cold.

Hi HappyMJ,

I guess you are right in saying that the Generation Tariff is ultimately paid for by the public via taxes. But, in this case, I see this (PV panels) as something that many people can take advantage of. I agree that some people will not be able to due to site location, etc, but there are also many other political decisions of which I am not happy and still have to pay for, for the good of all. This could become a political debate for this section and is best avoided I think. The point is, this particluar part of the pay back is NOT covered by an increase in electricty bills for everybody else. Maybe higher taxes via the government, but not higher bills via the electricty boards. (Unless, as I say above, somebody can state me a good source, then I will happily admit to being wrong. I am not too proud to admit being wrong if need be. )

Your second paragraph is extremely interesting and may be the main point I am missing! Or, to be more accurate, a point which I cannot discuss because I do not know enough about the grid storing electricty. If, however, you are saying there is a point where we are "letting energy dissipate into the ether", then I am at a loss for words (don't cheer ).

If this is indeed the case, then I believe the situation regarding energy and its storage and consumption are in an even worse state than I realised and I wonder why on earth this is the case. As I say though, I cannot comment on this without knowing more about it. Is it possible to point me to a link where I can read about this ... "energy going to waste into the ether if not used"?

CYE

Cardew

ClaimYourEnergy wrote: »

It's all very well saying you (as another electricity customer) are subsidising this, but this is the first I have heard of it and I have never seen any data to support what you are saying. On the contrary, I have shown you to sites that describe how the finacing is by the government. Don't take it personally, but just because you say it, does not make it so. Give me proper feedback with source, as it may help me understand what you are trying to say.


CYE

I really am most surprised that you don't seem aware of the basic principles behind the FIT scheme.

Put simply, the electricity companies have to pay customers registered with them the FIT of 43.3p/kWh(for retrofit PV systems <4kWp) and 3.1p/kWh for all exported electricity. There are other FITs for wind etc.

The electrity companies contribute to the 'Kitty' (and increase their customer charges to cover their contribution) and draw the FIT funds they pay out from this kitty.

As said in my earlier post, some small companies don't pay out any FITs because they are exempt from the scheme. However they do of course have to contribute to the kitty in proportion to the number of customers and their consumption

Again as said earlier, you can get your electricity from BG but collect FIT from EON.

The injustice of the scheme is that many people cannot fit PV systems because they rent accomodation, live in flats, or have the wrong orientation/unsuitable roof. This means that many of poorer people in our society(tenants and flat occupants) pay higher prices to fund those weathier house owners who can afford £10k to £15K for a system.

Even worse, is these same poorer people are paying for the venture capitalists who finance 'Rent a Roof' companies.

As someone said it is 'Robin Hood in Reverse' Rob the poor to pay the Rich!!!

If you want some reading, start here:

http://www.legislation.gov.uk/uksi/2011/1181/introduction/made
http://www.fitariffs.co.uk/FITs/principles/funding/
http://www.energysavingtrust.org.uk/Generate-your-own-energy/Sell-your-own-energy/Feed-in-Tariff-scheme
http://www.guardian.co.uk/environment/2010/apr/30/feed-in-tariff
Germany have been at this a lot longer than us, and this quote sums it up.

Commentators such as Chris Goodall and George Monbiot have argued that the scheme is a financially inefficient way of saving carbon compared to alternatives, such as large windfarms. One analysis by the Ruhr University suggests the German feed-in tariff cost €35bn to push solar to 0.6% of the country's electricity generation.

DVardysShadow

ClaimYourEnergy wrote: »

... Is it possible to point me to a link where I can read about this ... "energy going to waste into the ether if not used"?

CYE

No link. But it stands to reason. There is a certain amount of pumped storage capacity on the grid, but beyond the capacity of the pumped storage, there is nowhere for the energy to go. You could raise the voltage on the grid and make all the electric trains go a little faster, but most other motors are essentially fixed speed, so htey won't take the extra energy. Most heating is on thermostats, so this won't absorb more energy beyond the short term. Old style light bulbs would just pop - leaving even more surplus energy. So no mileage on raising voltage - meaning the grid won't take the energy.

So the only thing left to do is blow off surplus steam at the power stations - effectively to waste in the ether.

ClaimYourEnergy

DVardysShadow wrote: »

I fundamentally disagree with this. The price of energy is not fixed. Not even through the day. This is so that supplies are used cheapest first.

Your solar electricity is only available when the sun shines on you. But your energy is always accepted by the grid - whereas power stations can have their offers to supply turned down virtually minute by minute to match demand. So if you generate when you want, your electricity has to be the cheapest on the grid. You have to undercut all of the other suppliers. But when you want to use your electricity, you are effectively demanding another kWh from the most expensive power station on the grid to get back the kWh you sold so cheaply during the day.

So your kWh that you effectively banked with the network costs you the difference between your kWh selling rate when you supply and the buying rate of the most expensive kWh when you consume.

Additionally, your kWh probably turns into 0.85kWh by the time it is used, because of network losses - and to get back your kWh, 1.15kWh has to be put on the grid.

So the question is: whether selling 1kWh for the value of the cheapest 0.85kWh on the grid and buying back 1kWh for the price of the most expensive 1.15kWh on the grid is cheaper than just buying your 1kWh when you want it.

Hi DVardysShadow,

Your second point is a good one that I will address at the end. However, to your first point .... You are actually arguing from an even stronger viewpoint than my own about who owes who what. Here's why ....

The only time I would be able to "use" my own energy from the grid is *after* I have already given it to them. In other words, they have received it for nothing, and I am asking it back for nothing. The moment I use more than I have stored, I will pay for it!

And if I did generate enough energy to go backwards again, then I am still only doing so at the current rate! (Which, again, for the electricty company is "free".) So, these companies actually get to use the free portion of energy I just generated to charge somebody else for it - but, in the same token, allow me to get it back later for the same price I gave it to them to use: free!

The point is, PV panels will only store a very little amount of energy inthe grid at any one time. Electricty companies will STILL gain from it, as it would improve their "cash flow" of electricty.

I only want the energy I produced back at the price I generated it (free) ... and expect to pay as normal for energy used over and above what I generate in any given time.

SECOND POINT: I did not know about the "loss" of energy between transfers. This is a very good point and one that I agree I SHOULD pay for then. After all, as I have always said, I am not trying to take what is not fair, but argue for fairness. Therefore, I would like to know how much it would cost a company to take in and then pay back 1 KWh and deduct this from the cost of their normal unit cost?

In this case, it would make sense to seperate the meters, as a direct forward and backward moving dial would not allow for this. However, this should be the only cost for such units travelling back and forth from home to grid and back again. Take this value from the normal cost of a unit and you can then calculate a more accurate Feed In tariff value:

E.g. If a unit costs 15 p from a provider. Let us assume 30% loss for there and back travel. 15 p - 30% = 10.5 pence per unit generated. And this should be for every unit generated and NOT just 50% estimated, as long as it was accurately recorded on a meter that monitored the difference between feed in units and returned units. Such a meter should easily be availble as all it would need to do is track generated units (I believe this is what an Export meter does) and deduct used units from this meter first (calibrated with the 30% cost difference) before taking from the main grid usage meter.

Again, I am not saying we should not pay for electricty we eventually have to use from the grid, but that we should be better paid for that which we generate in the first place to more accurately reflect the amount we use to that which we generate.

CYE

ClaimYourEnergy

Cardew wrote: »

I really am most surprised that you don't seem aware of the basic principles behind the FIT scheme.

<SNIP>

Thanks Cardew,

I am taking a look at those links now and will come back to you in a while. ....

OK, I found this on one of those sites, which I think supports both of us, in that it comes from the government, but they will raise it via the utility companies:

Where will the money come from?

From the government, with payments made via the utilities companies. Jeremy Leggett, founder and chairman of Solarcentury, argues that each household will only see a rise of £8.50 per year in their bills but this is only a projected figure.

OK, even from just this one quote, I can see that others are subsidising. The point being, I did not know that the government were going to raise it via the utility companies rather than through normal taxation. However, even so, I still stand by the fact that there are many other "taxes" that I would not agree with, but I still pay into them. Maybe this is just one that can help me for a change. As I say in a post above, however, it is probably best not to be side-tracked by this, as we both agree that others do help subsidise the panels via a government decision.

And I am not sure this argument actually affects the point I am trying to make. I do agree that others are subsidising one way or another. HOWEVER, the energy generated (export tariff) is NOT part of this subsidised payment (generation tariff), as it is simply a transaction between the utility providers and the energy creator. This is why one can choose to "opt in" or "opt out". Whatever I choose has no bearing on those who are subsidising the Generation Tariff. This is simply a contract between energy generator and energy supplier.

It is the arrangement of the Export Tariff which I am arguing is not currently done fairly. Please examine my arguments in light of this.

CYE

ClaimYourEnergy

DVardysShadow wrote: »

No link. But it stands to reason. There is a certain amount of pumped storage capacity on the grid, but beyond the capacity of the pumped storage, there is nowhere for the energy to go. You could raise the voltage on the grid and make all the electric trains go a little faster, but most other motors are essentially fixed speed, so htey won't take the extra energy. Most heating is on thermostats, so this won't absorb more energy beyond the short term. Old style light bulbs would just pop - leaving even more surplus energy. So no mileage on raising voltage - meaning the grid won't take the energy.

So the only thing left to do is blow off surplus steam at the power stations - effectively to waste in the ether.

Terrible to hear ... but I appreiate your explanation.

CYE