By CCL Components•January 10, 2020•3 Minutes

The Department for Business, Energy & Industrial Strategy has introduced the Smart Export Guarantee (SEG), as of 1st of January 2020.

The SEG is a welcome replacement in the industry as the Feed-In Tariff (FiT) payments ended in March 2019, creating a void of any financial incentive between March - December 2019.

The SEG will ensure payment is made to an individual which generates electricity from renewable sources and exports it back to the grid - rewarding renewable energy generators for what they export. Sources such as solar PV, wind turbines, anaerobic digestion, hydro, micro-combined heat and power (with capacity set at 50kW). The maximum system capacity eligible for all systems bar MCHP is up to 5MW.

Companies with over 150,000 customers are required to offer a rate to be paid per kWh exported, the requirement being a rate 'higher than zero'. Shell has since upped their offered rate after initially offering a measly 0.001p per kWh. Companies with fewer than 150,000 are not obliged to have any tariff offering but many have, keen to entice customers who have renewable generation and export capabilities.

Feed-in-Tariff

SEG payments will also be a welcome reward for anyone currently receiving FiT payments and decide to add to their current renewable generation system at home, becoming eligible for a further SEG payment on top of their FiT payments. FiT payments are guaranteed for at least 20 years from the date of commission.

Furthermore, If you are able to receive a better tariff on your exports from SEG than you currently receive from the FiT payments you can opt-out and switch to SEG.

MCS

Any installation of renewables being considered for new SEG payments is required to have been installed from an MCS approved installer. Much the same when FiT payments were confirmed. Suppliers need assurance that any mechanism being connected to the grid is installed safely and o the required standards.

In Summary

The SEG is a welcome boost to the renewable energy industry. It has provided a calm in a sea of uncertainty for a large part of the previous year. Installers and suppliers were feeling contradicted by ambitious government targets on one hand and removal of proven successful incentives on the other.

Now that the prerogative for tariff rates is in the hands of the suppliers, it should prove beneficial for the renewable energy generators who will have the suppliers vying for their exported energy.

Watch this space...