UK energy department BEIS has unveiled fresh plans to support small-scale renewables via a so-called Smart Export Guarantee (SEG).
In its ‘The future for small-scale low-carbon generation‘ consultation, BEIS said the SEG would compensate such generators for the value of the electricity exported to the grid.
Remuneration would be available to all the technologies currently eligible for the feed-in tariff scheme up to 5MW in capacity.
The measures, which would be mandatory and supplier-led, would effectively replace the FiT generation tariff and export tariff that close to new applications on 31 March.
RenewableUK head of policy Barnaby Wharton said: “These government proposals rightly recognise the role that small-scale generation can play in developing a smarter, more decentralised energy system that benefits consumers.
“Small-scale wind energy and other renewable generation reduces overall demand on the grid and supports thousands of jobs in industries across the UK.
“It is vital that the value of this locally generated, low-carbon power is reflected in the final Smart Export Guarantee proposals.”
Solar Trade Association chief executive Chris Hewett gave the proposals a cautious welcome.
He said: “We are very pleased the government is unequivocal; small generators will be compensated for the power they contribute to the system, but the issue remains providing remuneration at a fair market rate.
“We are particularly pleased to see a clear requirement to meet MCS standards for participation in the scheme, which means safeguards for consumers will be retained.
“Positively, the government again identifies the system sell price as accurately reflecting the market value of power spilled to the grid.
“However, the consultation acknowledges many of the market barriers we have raised with government and the associated costs. Our worry is that these may impede the ability of suppliers to offer fair and meaningful rates, even though they may wish to.
“Customers are freely able to switch suppliers in a competitive market so where these costs fall remains vital to developing meaningful offers.
“Nevertheless this is a good basis for consultation. The devil really is in the detail here so we very much hope that Government will listen very carefully to the responses to this consultation.”
The Renewable Energy Association, which lobbied for a route to market for small-scale renewables to replace the closure of the export tariff, welcomed the move.
“It was clear that no-one should be asked to give away electricity for free, and we strongly advocated for a market based solution and are pleased this approach has been adopted,” said policy director James Court.
“Whilst the details around the transition from the former subsidy scheme will be important, this signal of support for the sector from Government will help our members continue to provide smarter, cleaner and cheaper electricity in the decade to come.”
The consultation is set to close on 5 March.