ESB low user standing charge increase

freddyuk

See here the new charges for low usage via ESB
http://www.esb.ie/esbcustomersupply/residential/price-plans/low-user-standing-charge.jsp#ex-q10

Now let us suppose we have solar PV or a wind turbine installed and produce much of our own power - do we potentially get hit with a higher charge?
Under 2kwh per day (imported) in any billing period is something we strive for. Is it now worth it.

Count to 10................:eek:

hi5

Will have to go back to leaving the lights on and the appliances left on standby:D

freddyuk

Won't work as standby uses virtually no power and i am installing LED's which also use no power so I will have to unlock the dishwasher and washing machine:D

hi5

Heres what you want...an electric patio heater...for heating up the outside;)

http://www.ebay.ie/itm/Outdoor-Heating-Commercial-Parasol-Heater-Patio-Heaters-/370546285213?pt=UK_Home_Garden_Garden_Structures_Fencing_CV&hash=item5646479a9d

Coles

There is no reason why that charge should be applied to Microgenerators and I imagine Electric Ireland/ESB will confirm that they won't be applying it to customers who provide electricity to the National Grid. That would be just stupid, right?



To quote the reason given for the introduction of the charge...

The charge is being introduced to enable Electric Ireland recover the costs associated with providing electricity to customers with very low consumption. These costs include a combination of the fixed charges associated with meter reading, network maintenance and a share of the supply costs incurred in servicing electricity accounts and are normally recovered through a combination of electricity units and standing charges. However, in situations where there is very low electricity usage as in the case of a vacant premises, these costs are not recovered fully. This charge will allow Electric Ireland to recover its costs in such circumstances.

freddyuk

Here is my simple request for clarification =

Quote - I understand a low usage standing charge is being applied from February. Would this affect anyone with a solar PV system installed and operating an export meter? If we generate good amounts of power we could fall into this category which would defeat the object of installing renewable systems.

Many thanks for clarification.
- Unquote

And here is their response -

Quote -
Thank you for your email.

For this query we have assigned tracking number 237266.


Our Lower User standing charge is due to be introduced on the 01.02.2012. You will need to refer to our website www.electricireland.ie and click on Electricity Residential/Price Plans/Low User standing charge for information on this.


If you require further assistance, please do not hesitate to contact us and we will be happy to help.
- Unquote

You can draw your own conclusions but I have re asked the question as I need an answer. Why it is such a difficult question to answer I do not know but they have not confirmed I would not be affected at this time. I cannot see where the website refers to micro generators and the new charges so fail to see why I need to keep asking the question.

Coles

Let's look at an example.

A 150m2 dwelling installs a 4kW array of Photovoltaic panels. this array operates at a system Load Factor of 13% and the annual production is 4550 units of electricity (kWHs). The house consumes 6800 units of electricity.

The data for this example are sourced from UK monthly household usage data and an SEAI PV case study.



For half the year the average billing period will be less than 2kWHrs per day and the ESB/EectricIreland will apply a levy of €30. This represents a clawback of 12% of the Microgenerator REFIT bonus.

A Wind turbine, a hydro turbine, a CHP unit or even a larger PV unit would suffer a 20% clawback of the REFIT bonus. An energy efficient house with a relatively small alternative energy installation will also suffer a clawback of the REFIT payment.

The SEAI need to be made aware of this as it's a further kick in the teeth for all their attempts to stimulate this sector and to encourage energy efficiency.

freddyuk

Thanks for doing that- I have not checked the figures but it makes the point quite concisely.
No doubt it is an oversight and ESB will confirm we are not impacted.:rolleyes:

freddyuk

OK I am going to relay the responses from Electric Ireland as I suspect renewables is a target:

Me:

Subject: Re: New low usage charges

Simply - will it affect me as I have solar micro generator?

Thank you.

Electric Ireland:

Thank you for your email.

For this query we have assigned tracking number 237266.


In relation to your query, I can confirm that the charge will only apply to a minority of customers who use an average of 2 units (2kWhs) or less per day in any billing period (typically 61 days). Therefore, it will not affect you unless you are using an average of 2 units (2kWhs) or less per day.

For more information, please click on the following link http://www.esb.ie/esbcustomersupply/residential/price-plans/low-user-standing-charge.jsp.

I hope the above information is satisfactory.



If you require further assistance, please do not hesitate to contact us and we will be happy to help.

Me:

I am sorry to keep asking the same question and I have read the website and it does not refer to micro-generation so it is of no help regarding my query. (unless I have missed the part which does refer to micro-generation).
If you are saying I am covered by the low usage charges then if I produce more energy than I need and sell the surplus back to ESB/Electric Ireland then it negates the whole point of generating my own power. Of course the whole point of micro-generation is to reduce the overall usage. During the summer months I will certainly be using less imported power than 2kwh if I possibly can as I will try to be a net generator. I can only conclude therefore that if I am successful in reducing my power requirements after investing several thousand Euro's you will increase my charges accordingly and defeat the whole object.

If this is not the case then please confirm otherwise I will need to ensure the proper authorities are aware of this ridiculous situation.

I have tried to ask a very concise question but there seems to be no concise reply unless my assumptions are correct.

Thank you for taking the time to confirm or deny the above.

I am thinking we are looking at a tax on renewable generation and this will impact all disciplines but as the take up is so low it makes no sense and revenue will be tiny. I will await the next reply and see if they can answer the question. If not I will take this further.

Coles

I sent an email to the SEAI earlier to notify them of the levy being applied on Microgenerators. No reply yet.

freddyuk

Reply received :

Thank you for your email.

For this query we have assigned tracking number 237266.


Can you provide your account number so that I could refer your query to a relevant department?


If you require further assistance, please do not hesitate to contact us and we will be happy to help.

Why my account number has any relevance to this enquiry I do not know but I will press on regardless.

freddyuk

Latest response from EI;

I have been in contact with the relevant department. They are currently reviewing the Low User Standing Charge implications for our Micro Generation customers and will be contacting them directly on the matter.

This is the only update we have as present, A representative should be in contact with you shortly.


If you require further assistance, please do not hesitate to contact us and we will be happy to help.

So it is under review.......... funny how it has not been reviewed and resolved already - what do these people get paid for.

hi5

Thats the way it works in Ireland.
Introduce a policy without any groundwork or investigation and amend it when and only as public outcry demands.

Coles

My Email to SEAI. As yet no reply.

I wish to draw your attention to the impending introduction by Electric Ireland/ESB of the 'Low User Standing Charge'.

This levy will amount to a charge of €9.45 for each billing period where the energy use amounts to 120 units of electricity or less.

This levy is intended to recoup the cost of maintaining the connections to users who consume low amounts of electricity, but as it stands it will also apply to MicroGenerators who offset their electricity usage with their own supply, or who export electricity to the Grid.

While an annual total of €56.70 may seem like a small amount of money, it represents a clawback of almost 20% of the ESB's remarkably low (and short term) MicroGeneration support payment of €300 per annum.

It is also very likely that the ESB will increase the levy over the coming years, while as we have seen in recent years, it is very unlikely that they will increase their support for MicroGeneration in any meaningful way over the same period.

We continue to have one of the lowest levels of support for MicroGeneration in the whole of Europe and the industry is dying on it's knees as a consequence.

I ask you to bring the implications of this levy to the attention of the ESB.

Yours sincerely,
...

Coles

Here's a thought.

If it just costs the ESB an additional €57 per year to cover the cost of providing (and servicing) a connection to a domestic customer who uses little or no electricity, why then do they need to pay only half the consumer rate for domestic renewable electricity exported to the Grid? The electricity is of a higher quality than the Grid electricity, the MicroGenerator has paid for and installed all the necessary safety switching to ensure the safety of the connection, there are no additional costs in billing or metering, and there are no transmission losses because the electricity is used locally.

How about the ESB apply the 'Low User Standing Charge' to MicroGenerators but pay the full consumer rate for electricity exported to the Grid?

freddyuk

There are about 400 people in Ireland that will agree with you for sure but one of them isn't ESB. This is a sop to the EU. I am sure most of us are not doing this for the money but to have the potential to be more self reliant in energy just in case it becomes quickly more expensive.(and to save the planet of course)
EDF in UK have just announced a reduction of 15% in their prices but we have just had the warmest winter period on record so their take is low anyway. Come next autumn they can increase the rate again and say how they reduced it when they could but now it needs to rise for investment in infrastructure in case the wholesale price argument will not fit. No point in having high prices in summer you want them in the winter so about September 2012 they will go back up.

freddyuk

Seems the original decision paper covers all the comments made here and specifically covers all of Coles comments! Sadly all the issues were ignored and the whole scheme was and remains a temporary arrangement hence the strange logic to the scheme.
I have paraphrased some of the points here

Coles

Does this make any sense to anyone?



How can ElectricIreland claim that the increase in the Standing Charge is €9.45 when it's actually €15.55?

This has a terrible impact on MicroGenerators.

Coles

Some charts showing the impact of this 'Low Usage Standing Charge' on MicroGenerators.


The impact on a 4kW Photovoltaic installation.


The impact on a 5kW Wind Turbine installation.

@Freddyuk, I bet that has cheered you up a bit!;)

Electric Ireland: David

Hi freddyuk,

freddyuk wrote:

I understand a low usage standing charge is being applied from February. Would this affect anyone with a solar PV system installed and operating an export meter? If we generate good amounts of power we could fall into this category which would defeat the object of installing renewable systems.

While we anticipate that very few of the customers availing of the Micro-generation Scheme will be affected by the Low User Standing Charge, it is not our intention to reduce the benefits of the Scheme to these customers. We will be communicating with them directly to explain how the charge will be handled in the event that a scheme participant has very low consumption in a given billing period.

In any event, I can confirm that for as long as the customer is in contract with Electric Ireland the application of the Low User Standing Charge will not result in a reduction in Micro-generation benefits.

Thanks,

David.

Electric Ireland: David

Coles wrote:

How can ElectricIreland claim that the increase in the Standing Charge is €9.45 when it's actually €15.55?

Hi Coles,

The average billing cycle is 61 days, so multiplying €0.155 x 61 should give you 9.455, which we rounded to €9.45 (incl. VAT).

Hope this clears it up.

Thanks,

David.

freddyuk

Electric Ireland: David wrote: »

Hi freddyuk,



While we anticipate that very few of the customers availing of the Micro-generation Scheme will be affected by the Low User Standing Charge, it is not our intention to reduce the benefits of the Scheme to these customers. We will be communicating with them directly to explain how the charge will be handled in the event that a scheme participant has very low consumption in a given billing period.

In any event, I can confirm that for as long as the customer is in contract with Electric Ireland the application of the Low User Standing Charge will not result in a reduction in Micro-generation benefits.

Thanks,

David.

I appreciate the response but your first sentence is ambiguous. I cannot fathom out why you need to contact customers individually "in the event a scheme participant has a very low usage"... Either we are being penalised or we are exempt from additional charges. You say that few will be affected but it is not the intention to reduce benefits to those customers - so you must be increasing the tariff for anyone being charged the extra levy?
"...not result in a reduction in Micro-generation benefits" could mean that you can increase the standing charge but not reduce the export tariff payment as the levy is not connected to micro-generation.. You state that we will be advised of how the charge will be handled which suggests that the charge will be applied in some form. Why is it so difficult? We are talking about a few hundred customers so why go to all the expense of making a special case?
The extra charge is to cover your (EI) higher % costs for servicing and collecting the billing information on a low usage property ie. empty so as I have just had a smart meter installed which does not require any effort from IE to collect the data I cannot see how I can fall into the low user bracket using that reasoning. I no longer need an employee to to come and read the meter. Possibly I will not be affected personally but this is a wider issue that needs to be explained and why certain micro-generators will be affected and some will not. The wind turbine brigade must be really concerned going by the figures from Coles.
I am sure you can understand the suspicion and scepticism when we get responses like this especially as the UK has caused no end of mayhem in that PV industry and that government is currently fighting a court action to ensure that their micro-generation industry is completely killed off.

If you could clarify the definitions that would enable us to relax a little and enable any prospective micro-generation customers to make an informed decision prior to spending the money.
Thanks

Coles

Electric Ireland: David wrote: »

Hi Coles,

The average billing cycle is 61 days, so multiplying €0.155 x 61 should give you 9.455, which we rounded to €9.45 (incl. VAT).

Hope this clears it up.

Thanks,

David.

Thanks for the reply David.

While that sum is indeed correct, it doesn't clarify why the Standing Charge for 'Low Usage' customers is being increased by €15.55 (incl VAT).

Electric Ireland: David

Hi freddyuk,

Sorry if there was any ambiguity; this was not intentional, and I hope to make it clear now so as to leave only one interpretation of how things stand.

If, for instance, in a given 2-month period, a Micro-Generation customer consumes only 100 units (on the balance of export/import) then the Low Usage Standing Charge is automatically applied. However, the customer would be refunded this amount in the form of an ex-gratia payment. We estimate that approx. 10% of Micro-Generation customers may be affected in this manner.

So, overall, that's what I mean by "will not result in a reduction in Micro-Generation benefits."

I hope this clears it up, but if you have any other questions I'll be happy to help.

Thanks,

David.

Electric Ireland: David

Coles wrote: »

Thanks for the reply David.

While that sum is indeed correct, it doesn't clarify why the Standing Charge for 'Low Usage' customers is being increased by €15.55 (incl VAT).

Hi Coles,

I think maybe you're reading the figures above in euros, rather than cents? The increase from 32.84c to 48.39 is 15.55c, so your figure is correct. If you move the decimal point over two places to the right, you'll have the per day increase, which (in a 61-day billing period) results in a Low User Standing Charge of €9.45.

Hope this helps.

Thanks,

David.

Coles

@ David. Ah right! Thanks.



The impact of the levy on a 1.5kW MicroHydro Turbine (60% load factor).

Coles

Electric Ireland: David wrote: »

We estimate that approx. 10% of Micro-Generation customers may be affected in this manner.

Thanks for the clarification that this levy will not impact on MicroGenerators. That really puts my mind at ease. It was definitely going to impact on a lot more than 10% of MicroGenerators, particularly as the average micro-wind installation was 5.1kW.



The SEAI MicroGeneration progress report.

freddyuk

Electric Ireland: David wrote: »

Hi freddyuk,

Sorry if there was any ambiguity; this was not intentional, and I hope to make it clear now so as to leave only one interpretation of how things stand.

If, for instance, in a given 2-month period, a Micro-Generation customer consumes only 100 units (on the balance of export/import) then the Low Usage Standing Charge is automatically applied. However, the customer would be refunded this amount in the form of an ex-gratia payment. We estimate that approx. 10% of Micro-Generation customers may be affected in this manner.

So, overall, that's what I mean by "will not result in a reduction in Micro-Generation benefits."

I hope this clears it up, but if you have any other questions I'll be happy to help.

Thanks,

David.

OK I understand what you are saying but I am not sure why. Is it not going to cost more to actually work out who is entitled to an "ex gratia" refund and send the cash back or will it be a credit to the account so we end up in credit to EI? If you just exempt all microgenerators then the problem does not arise. You seem to be adding in another level of admin work for which the new levy is being applied to support. If it is only 40 odd customers then it cannot be worth the cost surely? If the number is actually 200 then you have to do that much more work to send them all a credit each 2 months.
There will be a certain number of customers who are low users and they will get charged. All microgenerators will be registered in the system and therefore exempt automatically (even if their homes are empty the system will still be generating and feeding into the grid for others to use) so I just do not understand why you need to complicate things. Ex gratia means effectively you are doing us a favour because you are not legally obligated to pay the money back. I am not comfortable with that as it means we are in fact being penalised but not currently charged. There has to be an explanation?
It does not appear to make business sense, charging money over here and wasting it over there is classic government logic but EI is a business so that is why I maybe appear to be pedantic and looking for a logical explanation.

Priori

freddyuk wrote: »

You seem to be adding in another level of admin work for which the new levy is being applied to support. If it is only 40 odd customers then it cannot be worth the cost surely?

Actually I'd say it's the opposite; my guess is that their system isn't sufficiently organised/optimized to deal with automatically exempting MicroGen customers from the charge (i.e. they probably don't have the relevant coding/scripting in place on their system). Refunding customers in this ad hoc manner is how they initially handled the Free Electricity Allowance when their new priceplans came in. I had some trouble getting it properly applied to my grandmother's account.

If you knew the IT costs involved in making small system changes (they're crazy, believe me) then it definitely wouldn't be worth it from ESB's point of view to make these changes for 40 odd customers. I worked in a call-centre before when they were bringing in a new email system, and the cost of making small tweaks to it seemed ridiculous to me.

freddyuk

You could be right as my first bill from ESB/EI after I moved back last November to avail of the micro-generation tariff was received yesterday is dated 16th January 2012!! The meter is read every billing period by a nice lady and a new smart meter has been installed and the bill is estimated. So whatever system is in place needs a radical sorting out and the IT manager needs firing (IMHO).
I am sure David will clarify - at least he is responsive and wants to help....

Electric Ireland: David

Hi freddyuk,

freddyuk wrote:

All microgenerators will be registered in the system and therefore exempt automatically (even if their homes are empty the system will still be generating and feeding into the grid for others to use) so I just do not understand why you need to complicate things.

I can see where you're coming from, but unfortunately it's not quite as straight-forward as that when it comes to exempting customers registered on our system.

freddyuk wrote:

You seem to be adding in another level of admin work for which the new levy is being applied to support. If it is only 40 odd customers then it cannot be worth the cost surely? If the number is actually 200 then you have to do that much more work to send them all a credit each 2 months.

The credit covering any low usage standing charges will be refunded to affected customers when we make payment to them for their units exported to the grid (i.e. annually). We will be handling this process in the most cost-effective manner available, and I can assure you that we will not be adding in another layer of administration.

Thanks, and we do appreciate your feedback.

Regards,

David.

freddyuk

Thanks for clarifying David and actually it is worse than I thought as I will be debited the extra charge for a whole year so EI can sit on the cash - that is actually not owed - but to simplify the admin process we will lose up to €60 until we get a credit back at year end. When interest rates start to move up again that will be a quite an irritating situation, not that isn't already.
It is the same where a company imposes a direct debit scheme based on usage and increases the monthly charges so there is always a large credit in favour of the supplier. I never use that kind of scheme, which are normally voluntary, as I prefer to pay for what I use but in this case I am forced to offer EI credit for the privilege of installing my own renewable energy power source. I knew there was more to this and you have finally admitted that we will effectively lose out financially.
Quote:
In any event, I can confirm that for as long as the customer is in contract with Electric Ireland the application of the Low User Standing Charge will not result in a reduction in Micro-generation benefits. Unquote.
Well yes it will unless you include interest on top.

Coles

@Electric Ireland (David), When your research suggested that only 10% of MicroGenerators would be impacted by this increase in the standing charge is that because you found that MicroGenerators aren't exporting their electricity onto the Grid (beyond the 3000 units at the 10c/unit bonus), and are instead using the surplus electricity for water heating or to supplement their central heating?

I can't come to any other conclusion, and it is a damning indictment of the shambles that the MicroGeneration 'support' scheme has become. MicroGenerators are forced to comply with the most ridiculous regulations in terms of the quality of the power they produce, but it makes better commercial sense to use this electricity for heating water!?

Let's look at the energy hierarchy for a moment. Wood or coal can be burnt to produce heat, which can be used to boil water and create steam, which can be used to drive a mechanical turbine, which can produce electricity which has to be rectified/inverted to match the grid, which can then be easily transported to the point of use. Electricity is at the top of the pyramid of energy hierarchy, and every single stage of the process to create this electricity is wasteful of energy.

But in Ireland a MicroGenerator gets a better return by using this clean electricity to do a task that could be accomplished by logs or coal, than by providing it to the National Grid.

It seems completely insane. Perhaps it is?

freddyuk

We are just in the middle of the battle between the political aspirations of government and the commercial desires of the supply companies. If it was purely a commercial thing I would not be going down this route but to be penalised now after spending the cash on the hardware I cannot go back so I will be monitoring my system entirely for my benefit.

Coles

The progress in the UK stands in stark contrast to Ireland.

A good read. UK MicroGeneration progress Report

freddyuk

Got it and read it. Sadly killing off the financial incentive from 43.3p to 9p instantly will kill the industry stone dead. Currently it is dead while the government is in court and I see no revival so government target will not be met by domestic PV. Those in the cabinet want maximum 9p FIT.
They are throwing money at marine wind turbines which have a terrible record and potential payback is not proven. PV is proven and a balanced reduction in financial incentive would match the reduction in capital cost but no they could not manage that simple exercise so they killed it off through incompetence and lack of any business acumen. Installation graph went vertical in mid October when they announced the cut in FIT from 12th December and now it is flat lined.

Coles

freddyuk wrote: »

Got it and read it. Sadly killing off the financial incentive from 43.3p to 9p instantly will kill the industry stone dead. Currently it is dead while the government is in court and I see no revival so government target will not be met by domestic PV. Those in the cabinet want maximum 9p FIT.

Is the PV REFiT not 24.1p now? 28cent/kWh compared to 9c/kWh in Ireland.

freddyuk

No there is no idea of what the legal FIT may be as it is total confusion. The official line was it would be 43.3p from 12th December until 1st April and then drop to 21p for the remainder of 25 years.(everything before 12th qualified for 43.3p for 25 years). In April the new energy rating scheme comes in so if you have solar installed and your house does not make the 'C' rating your FIT payment will drop to 9p for 25 years. Most existing houses will not make that rating or they will spend thousands getting the rating which negates the fit income.
Until the court case is resolved no one is sure what the deal is currently so very few are risking an installation on domestic property.
Once the court case is resolved I reckon it will be pretty much April and the new regulations will be in so the scheme will be dead as 9p does not make financial sense.
That is how I understand it currently.

I think you are adding the export rate of 3p to get 24p.

freddyuk

Here is an update to this old thread with information from ESB/Electric Ireland:

Quote:
The low usage scheme applies to customers that use on average 2 or less units of electricity per day. Because this was causing an issue with Microgen users being overcharged, we adapted our pricing to include micro-generation customers as being exempt from the Low User standing charge. However it still appears on the bill. To rectify this issue, twice yearly the difference between the regular standing charge and what the microgen customers are being charged is refunded by means of a credit on the bill. So it will appear that you are being charged a low user standing charge if your import is low, but I can assure you that any difference will be refunded.
Example, if you started on the scheme next week and for the next 6 bills were charged as a low user because of the micro-generator, then we would refund the difference to you twice a year, once in February, and again in August.
If your bill is in constant credit as a result, then we can arrange for the funds to be transferred back into your bank account by means of an EFT(Electronic Funds Transfer), or by cheque if you are a non direct-debit customer.
Unquote.

Sorted.

Coles

More than 18 months! Crazy that it took so long.