Electric Ireland Stops Feed In Tariff for Microgenerators

quentingargan

DCENR is holding a workshop this Friday in Cork on Shaping Future Energy Policy for Ireland. Ringaskiddy 1.30pm to 5.00pm. If people can make it and share their views, it may be a useful forum at which to do so..

jathclare

JonathonS wrote: »

This thread contains a lot of heat but not much light on EI’s decision …..:)

I am one of the majority of domestic electricity users for whom microgeneration is not an option. So my question is this. If EI and others pay 9c per kWhr for electricity generated by microgenerators, will this result in a reduction or an increase in total costs for these companies?

My guess is an increase. The cost of administering applications from hundreds or thousands of applicants, and ongoing admin thereafter would not be offset by the value of the electricity supplied at 9c per kWhr, and maybe not even at 0c per kWhr.

On the other hand, if anyone can prove that microgeneration will result in reduced costs for EI (which I perhaps foolishly assume will then result in lower costs for me…), then I will certainly join the campaign for the re-introduction of an FIT.

The short answer is Yes. Electricity generation is only about 60% efficient from non-renewable sources, and a further 30% is lost getting it to households.

A PVarray is about 98% efficient. If used by the producer, there is no transmission loss. If exported the grid and used, it is nearly 70% efficient. EI should be able to generate savings on the power they buy from the ESB based on that differential and pass it onto the producer. They can also look good by being environmental friendly etc.

One thing I agree with EI is that they shouldn't be the only ones offering the scheme, the other companies should be compelled to offer a FIT, and at rates that make economic sense to the producer to get up and running.

recedite

JonathonS wrote: »

The cost of administering applications from hundreds or thousands of applicants, and ongoing admin thereafter would not be offset by the value of the electricity supplied at 9c per kWhr...

Annually, new applications would not be hundreds of thousands.
It would be tens of thousands if they became a standard feature on newly built houses, which would obviously be considered desirable in terms of EU policy on reducing carbon emissions.
And these are all subject to admin work anyway, as they require new meters and MPRN numbers with or without solar PV. Once set up, the whole process is automated.
If the solar PV is to be discouraged from new houses, then we are only talking applications in the low hundreds, coming from the "enthusiasts".

quentingargan

JonathonS wrote: »

If EI and others pay 9c per kWhr for electricity generated by microgenerators, will this result in a reduction or an increase in total costs for these companies?

The 9c being paid to solar microgenerators is very little more than the 7c or 8c paid to wind farms. but arguably the electricity is more valuable because it is 100% produced during the day, usually at a time when there is less wind, and it is already on the local loop. My panels export their surplus to my neighbour at about 99% efficiency. I doubt there is more than a 1% cable loss between our houses.

The downside is that when this happens, there is a gas fired station somewhere lying idle (or maybe a peat fired one...). It is the idle surplus capacity that costs money when renewables are added to the grid, but that applies to all renewables.

The cost argument becomes difficult right now when oil is as low as $64 a barrel, but there are strategic (Russia...), environmental and long-term fossil fuel cost arguments that all suggest that a steady increase in renewable energy on the grid is required.

But in truth, I expect that solar microgeneration does not increase the cost of electricity as much as wind.

JonathonS

quentingargan wrote: »

The downside is that when this happens, there is a gas fired station somewhere lying idle (or maybe a peat fired one...). It is the idle surplus capacity that costs money when renewables are added to the grid, but that applies to all renewables.

Idle capacity and loss-making generation (such as Turlough Hill) is a necessary part of ensuring that there is a balanced supply from a variety of sources that can meet demand as it arises. It seems that the industry does not want to increase the idle periods and therefore add cost by paying microgenerators. As an EI customer that makes sense to me.

As pointed out by others above the case for PV solar power would seem to rest solely on its capacity to reduce the cost of electricity for the user, and not on the potential to get a payback from an FIT.

JonathonS

recedite wrote: »

Annually, new applications would not be hundreds of thousands.

I did say hundreds OR thousands.:)

recedite

OK I misread that originally.

hfallada

jathclare wrote: »

The short answer is Yes. Electricity generation is only about 60% efficient from non-renewable sources, and a further 30% is lost getting it to households.

A PVarray is about 98% efficient. If used by the producer, there is no transmission loss. If exported the grid and used, it is nearly 70% efficient. EI should be able to generate savings on the power they buy from the ESB based on that differential and pass it onto the producer. They can also look good by being environmental friendly etc.

One thing I agree with EI is that they shouldn't be the only ones offering the scheme, the other companies should be compelled to offer a FIT, and at rates that make economic sense to the producer to get up and running.

I studied LC physics and the teacher phoned the ESB to ask about the loss of electricity through transmission. Its was only something like €50000 per year. The fact most electricity is high voltage over long distant, means there is minimal losses to the network

recedite

JonathonS wrote: »

It seems that the industry does not want to increase the idle periods and therefore add cost by paying microgenerators.

I don't accept the argument that all microgeneration or all renewable energy increases the cost of electricity. Because there are a lot of factors balancing supply with demand at any given moment.
As a very crude national solution, we could determine maximum demand, and then run generators 24/7 that are capable of satisfying that demand. In that scenario, wind and solar increase costs because their back-up is still running.
Hydro such as Ardnacrusha can be considered stable and reliable.

Bring into the equation some "smart" solutions and synergies, and the economics change again. Solar corresponding with peak daytime usage. The possibility of more "Spirit of Ireland" Turlough Hill type facilities which convert night electricity into daytime power. Interconnectors to the UK to export wind and/or import nuclear power depending on the need.
Smart meters and variable rate tariffs that allows users to take advantage of cheap power. Electric cars, charged whenever electricity is cheapest. Carbon taxes.
Some of these are around already, some are not. More are needed.

Simply saying we need to keep burning the same amount of fossil fuels all the time in the background, just in case the wind stops blowing and the sun doesn't shine, and then everyone might put on the electric kettle to make tea at the same time, that is just a lazy way out.

JonathonS

recedite wrote: »

I don't accept the argument that ... all renewable energy increases the cost of electricity.

Simply saying we need to keep burning the same amount of fossil fuels all the time in the background... is just a lazy way out.

I'm not sure if you are suggesting that I made those arguments, I didn't.

Renewables are key, but paying an FIT for microgeneration does not make financial sense right now.

galwaytt

I was at a talk yesterday and a Japanese Govt speaker gave info on the Japanese market.

The govt there are now pulling the feed-in-tariff as well, as it's costing the govt too much money. There are also issues with stability of supply and the capacity of the grid for the volume of connections.

Current amount of PV supplied to the grid is 14,320MW, of which 49% is from installations generating less than 10kW.

As of Sept 2014, they have suspended any new PV connections to the grid, and feel there is too much PV in the market and are looking to other sources.

To wit, and because since the earthquake of 2011, their reliance on fossil-fuel generated power has gone from low 60% range to a now 88% reliance, they are re-commissioning nuclear from Spring 2015. They also stated that without nuclear, they are not in a position to offer any reductions in CO2 emissions. They currently have 57 nuclear stations offline.

MayoSalmon

recedite wrote: »

Simply saying we need to keep burning the same amount of fossil fuels all the time in the background, just in case the wind stops blowing and the sun doesn't shine, and then everyone might put on the electric kettle to make tea at the same time, that is just a lazy way out.

This has nothing to do with being lazy...its just how the "current" electricity grid operates.

The whole energy sector needs to re-think/design what its doing instead of just trying to jam renewables into it and pretending it works.

jathclare

In basic economic terms, EI are buying @ 9c from Micro Generators and selling it to consumers at 20c per unit.

Thats a margin of 55% for clean energy. There is no question that an established business can cover costs and be profitable at that rate.

As Mico-generation is more efficent than fossil fuels and has less transmission loss, they are really getting units closer to 5 or 6 cent, so this margin is actually higher in reality.

ch750536

Serious question people, why don't we start our own micro generation power company, that acts as middle man between micro's and grid?

MayoSalmon

jathclare wrote: »

In basic economic terms, EI are buying @ 9c from Micro Generators and selling it to consumers at 20c per unit.

Thats a margin of 55% for clean energy. There is no question that an established business can cover costs and be profitable at that rate.

As Mico-generation is more efficent than fossil fuels and has less transmission loss, they are really getting units closer to 5 or 6 cent, so this margin is actually higher in reality.

Is it? Micro-Generation is variable generation aka it is NOT reliable. Unfortunately in terms of how the Irish grid works wind/solar etc is not efficient power.

quentingargan

The argument here seems to hinge entirely around whether it is cost effective for solar to go head-to-head with gas. In other countries, they are paying as much as 45c per KwHr for clean electricity to try to reduce their carbon emissions. We can't seem to pay 9c without wringing our hands.

Do we all think that using coal, oil and gas to produce electricity can just go on forever? The vast majority of scientists, and governments, think we can't. But our regulator doesn't seem to think Ireland should pay for the infrastructure to displace it. This infrastructure is a combination of interconnectors, wind, solar, hydro, and most important, demand-side management - switching off non-essential loads when renewables are in insufficient. Then use your gas and oil fired stations to fill the shortfall.

For that to work, you must have a lot of spare generation capacity which spends a lot of its time idling, so arguably energy from that source is expensive, and should be charged accordingly if you have essential loads (or forgot to put the washing machine on at 3.00am).

We are going to have to get to that point somehow, unless we believe that oil and gas are an infinite resource which does no harm whatsoever to the environment on which we all depend.

I'll now sit back and wait for a lashing from the climate sceptics. :rolleyes:

Jaysus sher go 'way outta that, our state can't even reliably support the GTI's they prescribe, yer mad with yer fancy talk, sher won't there be more coal fer us if Holland isn't burning it?

ted1

jathclare wrote: »

In basic economic terms, EI are buying @ 9c from Micro Generators and selling it to consumers at 20c per unit.

The 20c is inclusive of VAT. They can buy it in bulk at 4cent. With less overheads than dealing with seperate accounts.

recedite

ted1 wrote: »

They can buy it in bulk at 4cent.

Carbon tax needs to be higher then.
Actually, do they pay carbon tax on the gas used in generating electricity, or is it just a tax levied on ordinary consumers?

ted1

recedite wrote: »

Carbon tax needs to be higher then.
Actually, do they pay carbon tax on the gas used in generating electricity, or is it just a tax levied on ordinary consumers?

It's dear enough as it is. Carbon tax is based in the principle that the end user pays.

recedite

Yes, but who is the end user of the gas used in a gas powered electricity generating station? The utility company or the consumer of the electricity?

galwaytt

recedite wrote: »

Carbon tax needs to be higher then.
Actually, do they pay carbon tax on the gas used in generating electricity, or is it just a tax levied on ordinary consumers?

Carbon tax needs to be abandoned you mean.

It has no place in our market.

ted1

recedite wrote: »

Yes, but who is the end user of the gas used in a gas powered electricity generating station? The utility company or the consumer of the electricity?

Obviously it's the consumer, it's in the name

recedite

ted1 wrote: »

Obviously it's the consumer, it's in the name

Its not altogether obvious, if the consumer does not even have a gas connection, that they would be paying a carbon tax for gas.

Anyway, my point is that if an electricity provider can buy gas powered electricity from a generating station at 4-5c per unit (without paying carbon tax) then why would they be ar$ed paying 9c for solar or even 7-8c to wind farms? Buying at 9c and selling at 18c is a nice mark-up, but buying at 4c and selling at 18c is even better.
Alloying for zero transmission losses, the solar is going to provide a higher mark-up to the provider than the 9c differential implies, probably the same or better than the wind farm electricity.

AFAIK the generating stations are involved in an EU carbon credits scheme, but the credits started off being issued for free. At some point in the future, it will not be possible for providers to buy such cheap gas produced electricity because the ever increasing cost of carbon emissions will be factored in to the wholesale price.
Maybe they will be able to buy in nuclear produced electricity then via the interconnectors when that time comes. But the same principles apply there; the economics of nuclear power depends entirely on who pays the long term clean-up costs - is it the industry or the taxpayer.

Unless carbon taxes are properly applied, renewables are effectively subsidising fossil fuels because all their costs are front loaded.

ted1

recedite wrote: »

Its not altogether obvious, if the consumer does not even have a gas connection, that they would be paying a carbon tax for gas.

Anyway, my point is that if an electricity provider can buy gas powered electricity from a generating station at 4-5c per unit (without paying carbon tax) then why would they be ar$ed paying 9c for solar or even 7-8c to wind farms? Buying at 9c and selling at 18c is a nice mark-up, but buying at 4c and selling at 18c is even better.
Alloying for zero transmission losses, the solar is going to provide a higher mark-up to the provider than the 9c differential implies, probably the same or better than the wind farm electricity.

AFAIK the generating stations are involved in an EU carbon credits scheme, but the credits started off being issued for free. At some point in the future, it will not be possible for providers to buy such cheap gas produced electricity because the ever increasing cost of carbon emissions will be factored in to the wholesale price.
Maybe they will be able to buy in nuclear produced electricity then via the interconnectors when that time comes. But the same principles apply there; the economics of nuclear power depends entirely on who pays the long term clean-up costs - is it the industry or the taxpayer.

Unless carbon taxes are properly applied, renewables are effectively subsidising fossil fuels because all their costs are front loaded.

Electricity is bought on the SEM. They don't choose where IT comes from and all generators get the same price be they wind, gas, coal , EWIC etc. It's not a matter of buying for 4 cent and selling for 18. There are other costs such as DUOS and TUOS etc

user 97

Photovoltaic Solar panels seem to offer a benign means to generate electricity at home/business/farm.
With a longevity lasting 30years operating at over 80% efficiency and a depletion of 0.2.% each year.
This creates a wonderful opportunity for everybody to start generating our own electricity rather than buying it from the National electricity grid network.

However, maintaining our connection with the electrical supply companies will remain necessary as our need for the power may well be at a time where the Pv panels will not be generating any power. ( night time for an example ).

Energy analysis at Ireland's latitude of 53*North.
typical 5 Solar hours/ day
therefore a 5kW Pv solar array should generate approximately
5 x 5 : 25kW/hr per day . There are losses to consider , remember that the solar panels operate at around 80% and the system itself will occur losses .
So if we take a 33% loss then this suggests that our 5kWatt Pv array should provide
Approximately ( 25 x 365 ) - 33% equals approximately 6000 kW/hr's/ year.
With regard to selling any surplus , don't worry about how much You get for each unit
of electricity Your Solar panels export as long as governance is given to Your system.
This way Your own Power get used by You in-house and not coming through the electrical
meter.

Coles

@user 97, It makes no sense to export excess electricity for nothing. The FG/Labour government have killed the renewable energy industry.

user 97

You may be right ,
however my comment related to ; A Photovoltaic array will rarely be exporting any electric if governance is given to the inverter, close to all should be consumed in-house.

Coles

user 97 wrote: »

You may be right ,
however my comment related to ; A Photovoltaic array will rarely be exporting any electric if governance is given to the inverter, close to all should be consumed in-house.

And that's the bit that suggests that you are talking through your hat. An inverter can not regulate the consumption of electricity. If the home owner has no need for the electricity being produced then it is wasted. In Ireland it is not possible to get reimbursed for exporting excess production to the National Grid.

user 97

I think your figures are a mite off there User 97.

user 97 wrote: »

operating at over 80% efficiency and a depletion of 0.2.% each year.

Mono / poly modules are about 15% efficient at converting solar irradiation into electricity. Thin film is half that.

0.8% depletion isn't guaranteed it's just manufacturers covering their bottoms for modules hung under partial shade and things.

user 97 wrote: »

typical 5 Solar hours/ day
therefore a 5kW Pv solar array should generate approximately
5 x 5 : 25kW/hr per day.

Not on your life.
Output = 15% of input. Input = flux density.

My panels are producing 7am to 8pm these days. Naff all in Winter so I don't know where your 5 hours comes from.

user 97 wrote: »

So if we take a 33% loss then this suggests that our 5kWatt Pv array should provide

If you manage to lose 33% between panel and load then chances are you will start a fire considering your 5kW array is producing 1.667kW of heat in your installation.