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Selling renewable energy

MS01

Hi there,

 

I have a question regarding the sale of energy from local renewable sources which I have been asked by a developer. For example you have a private wire network that serves 20 commercial consumers, as its stands as the landlord you have the contract with an energy provider and recover your costs through charging your tenants in line with the Ofgem regulations so other than an acceptable service charge you can’t make a profit from its resale. However if they were to look at turning this into a micro grid with installing lots of PV and other renewable solutions can the landlord continue to charge the tenants at their current billing rates and therefore benefit from the payment gap between what the tenants pay and what the landlord pays to the energy provider.

 

I not sure where this sits with regards to acting as an energy seller and the need for a licence or whether this strategy fails to meet the Ofgem requirements. Has anyone had anything similar?  

  • 0

    At present, the law does not permit the sale of energy from local renewable sources to directly consumers*. This is very unfair and is inhibiting the development of more small scale renewable energy because at the moment the only way to sell is to a energy supplier via the Smart Energy Guarantee (typically about 5p/kWh)which is not enough for these schemes to be economically viable.

    There is a "work around" using Energy Local. This enables a generator or network of generators to sell electricity directly to consumers in the local area BUT all the consumers would have to sign up to the same electricity supplier and at present the choice is limited to Octopus and I think one other supplier.

    * the exception is on one site with one supply whereby a tenant (eg. a community energy group with a PV system on a landlords roof) can sell electricity to the landlord, so the generated power never reaches the grid.

    This isn't exactly your scenario, but I hope it is similar enough to be of some help.

    Regards

    Dave

  • 0

    Hi Dave, 

    you mention these is a work around, noting there is only 1 electricity supplier which the landlord pays the bill and recovers the monies back from multiple tenants. Therefore would this work based on this? noting this is landlord selling to the tenants not the other way round. 

    Thanks 

    Matt 

  • 0

    HI Dave, I dont have any idea about Ofgem regulations, However you can generate power from PV system and sell it to state or power distribution companies normally known as net metering. It use  bidirectional meters to keep record of both consumed and sell power,  you have to check with local power distribution authorities regarding net metering.

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