Ourpower

Ourpower Guides - How do you sell your electricity?

More and more people are generating their own electricity. They may be doing this using Wind or Hydro Turbines, or Solar Photovoltaic panels. Remember though that Solar Thermal and Heat Pumps do not make electricity.
Some are 'off-grid' - in remote locations with no electricity grid available to connect to or generating power for their boat or caravan.
Others are connected to the grid - 'on-grid' - and can sell any surplus power they produce. Remember, even if your electricity generation does not cover your needs every day of the year, or every hour of the day, there will likely be periods when you are producing more electricity than you need. So sell it.

Introduction

Generally, it is best to size your generating capacity to match your needs. In this way, the electricity you produce offsets electricity you would have purchased. Currently, this will always effectively be the highest price you will receive for your electricity (as no-one will currently pay you more than you must pay for the electricity you buy).
However, there will always be times when you do not need to use all the electricity you are generating.
A small generator can choose from a variety of different schemes, with the range and benefit of these schemes likely to grow as the market establishes further. However, first you must get connected.

Getting Connected

Before connecting your renewable generator to the grid, you will need to comply with the regulations of your local electricity distribution company (DNO). How this is done depends on the size (capacity) of your installation.
If your generator is less than 16A per phase in size, (either 3.6kW single phase supply or 11.2kW three phase supply), you will need to fill in a G83 form for compliance (available from your installer or local electricity distribution company). You will then have an automatic connection to the distribution network as long as you can comply with the terms set in G83. If your generator is larger than this, you will need to contact your distribution company and negotiate directly for a connection.
A G83 compliant inverted must also be fitted.

Renewable Obligation Certificates (ROCs)

ROCs are currently issued for each megawatt hour (MWh) of renewable electricity generated in the UK. Each ROC is worth between £30 and £50 depending on market conditions. These ROCs are used by other larger generators as a way of achieving their government set targets on renewable energy - they must either earn their own ROCs from generating a growing % of renewable electricity; or buy ROCs from other renewable generators who have a surplus (including houselhold microgenerators); or pay a 'buy-out' price.
As a householder, you can register as a renewable generator with Ofgem, and then can be issued, once a year, with the number of ROCs you have 'earned'. A meter that shows the total generated renewable energy is all that is needed - which should always be installed with the Solar PV panels or Wind turbine.
Remember, ROCs are received for every MWh of electricity you produce - not just spare electricity that is exported to the grid. It is this fact along with some of the other costs associated with different metering options that makes different sales solutions suitable for different types of home generator.
So the normal meter you have with your microgen equipment will allow you to register your total units generated, and so receive ROCs. But to be paid for your surplus electricity that 'spills' onto the grid, you will need an Export meter.

Metering

The following basic types of meters are available:

  • Import meter, the standard electricity meter measuring units (KWhs) used, as exists in all grid connected homes already.
  • Total generation meter, that measures the total units produced by the microgeneration system.
  • Export meter, that measures the surplus electricity exported back to the grid. One type of export meter for small generators is called a non-half hourly (NHH) meter. It costs about £75 plus VAT per year to operate

Where an export meter is fitted alongside an import meter, a 'dual metering' system is said to be in place. This is slightly different to a 'net metering' system, where effectively a meter may run 'backwards' when surplus electricity is exported. The key difference is that with net metering there is no way to differentiate total import and export - just the net result. This effectively means that the same price is paid for import and export.
In the UK, net metering of this sort is still not allowed - issues of VAT often being cited. However, dual metering allows (but doesn't guarantee) the same pricing situation to exist. See below for some of the options available.

Selling your electricity - types of contract available

There are increasingly varied types of contract available to home generators, affecting the price paid for electricity exported, price paid for any ROCs if sold, the types of meter and administration that is needed:

  • Single price paid for all electricity generated, principally only taking account of the ROCs (i.e. working on the basis little electricity will be exported); the cost of an Export meter is avoided, with just a Total Generation meter required (which is usually installed with the generation equipment).
  • Price paid for each unit exported, and a price paid for ROCs; in this example an Export meter is needed as well as the Total Generation meter, and there is greater administration and form filling.
  • Just the surplus electricity is bought - with the generator selling ROCs elsewhere. Again an Export meter is required.
  • A fixed price is paid per peak Kw of installed generation capacity. No metering of any sort is required.

The price paid for ROCs may be somewhere between 3p and 5p per KWh. The price for electricity exported has typically been closer to the wholesale price (e.g. 3p per unit) than the retail price of closer to 10p per unit. However, as competition grows, there are more competitive packages being offered - some trial schemes even offer the benefits of 'net metering' where the same price is paid for exported electricity as the homeowner pays for his imported electricity.

The following are possible buyers of your electricity and/or ROCs: