Monthly archives: February 2010

When thinking about renewable electricity for your home, two options spring to mind; photovoltaic panels and small wind turbines. But which one should you choose? The government has introduced a feed-in-tariff that pays a subsidized amount for the electricity they produce and the amount paid for small wind turbines is similar to that paid for small PV systems (34p/kWh compared to 41p/kWh).

The key criteria to deciding which technology will be the most profitable is the cost of producing a unit of energy from each one. For this you need to factor in the up front costs such as equipment and installation, and then look at how much energy they will produce once out there over an average year. Without going too heavily into numbers my argument is that in some instances, micro-wind turbines will have a lower cost of energy than solar panels, but for the majority of cases solar panels will be better and this can be explained by some basic science.

Without a doubt, on a large scale, wind energy is cheaper than solar. The cost of energy from large-scale wind farms is somewhere around 10p/kWh whereas the cost of energy from large-scale solar is three to four times greater at present. Big wind turbines are now very well designed products and many years of industry development means that the costs have fallen dramatically and continue to do so. Big solar farms are also rapidly reducing in cost and make a lot of sense in some locations, particularly in the many regions where wind farms are not suitable, but for now they do not compete.

On the small scale however, the economics are drastically different. As the size of a solar installation decreases, the performance falls linearly with the amount of area used, and therefore the cost of energy does not change so dramatically. In contrast, as wind turbines get smaller their performance gets disproportionately worse. This is for two mains reasons:

The first reason is that as the turbine blade length gets shorter, the ‘swept-area’ decreases quadratically. This means that if you decrease the length of a blade from 80 meters to 40 meters, the area covered by the blade decreases from 20 thousand square meters to just 5 thousand. The ‘swept-area’ determines how much wind energy the turbine can use. So when you decrease the blade length you still need all the expensive moving parts like the generator, but you get disproportionally less energy – for one big wind turbine you would need thousands of smaller ones to cover the same area. The second reason is that where you use micro-wind turbines the wind speed is generally slower. This is because most of us live in built up areas where there are other buildings nearby. These buildings disrupt the wind, making it irregular and slow. Wind speed is crucial to the effectiveness of a wind turbine, again because the energy contained in the wind is disproportional to its speed. If the wind speed drops by a factor of 2, the energy produced by a wind turbine decreases by a factor of 4. Comparing most built up areas, the average wind speed is much lower than half the wind speed found high-up in open spaces where you find most wind farms.

These two factors combine to mean that for most homeowners solar panels are the most sensible and safest option. Of course, if you live near an open space and get a lot of wind then a micro-wind turbine could be a great investment. However, if you do live near a windy open space, I would suggest trying to build as big a wind turbine as possible, as their cost effectiveness increases dramatically with size.

With the UK government announcing the imminent introduction of a feed-in tariff for renewable energy generation, the UK solar industry is already seeing the development of a grass roots approach to solar energy.

Feed-in tariffs which have been established in other developed countries with the basic motive of attracting investment in fledgling renewable industries will be replicated in Britain with solar installers being offered premium rates (typically 25p/kWh over a project’s lifetime) for the units of energy fed back in to the national grid.

Such incentives are of course absolutely necessary in order to make investment in expensive technologies viable by offering attractive returns on investment to investors.

One of the first projects to take advantage of the feed-in tariff or ‘Clean Energy Cash Back’ scheme is a social housing scheme in Manchester which plans to generate around £900 per household a year by selling renewable energy back in to the national grid.

The Manchester based co-operative called Horizon Energy Corporative is working with landlords in the Manchester area to maximise the potential of solar energy in the Manchester region.

The scheme, put together by EIC has received the full support of the department of Energy and Climate Change (DECC) which hopes that such schemes will help the UK to catch up with other countries where feed-in tariffs have been established now for some time while at the same time offering financial rewards for social housing projects.

Managing Director of EIC, Andrew Melchior stated that,

“Our energy will be used to drive down the costs of electricity and hot water for those in need of relief from fuel poverty, while supplying community-generated energy to householders in North West England.

With sufficient support there is no reason we shouldn’t end up producing energy output equivalent to one quarter of a conventional coal-fired power station.”

In a bid to prevent a shortfall in rate payments for pioneers in small scale renewable energy investment, Good Energy has promised to continue to pay its generators 15p /kWh rather than the 9p / kWh set out in the recently announced tariff legislation.

Good Energy, dealing solely in renewable energy has announced that the government’s recent tariff scheme would harm their so-called ‘pioneer’ generators who installed their renewable technology before the cut-off date of July 15, 2009. Under the new tariff regime to come into effect in the Spring of this year, these pre -July 15 customers would only be eligible for a 9p/kWh payment for units of renewable energy compared to a payment of 41.3p/ kWh for installations after this date.

In a bid to keep pioneer installors viable until when they hope the government will amend their pre July 15, 2009 rule, Good Energy will continue to pay these generators the previous 15p/kWh rate. Currently, Good Energy sees itself as a market leader in renewable energy uptake incentivisation and wants to continue awarding attractive incentives for smale scale installors of renewable energy technology. Leading the way in 2004 with their renewable energy incentive scheme HomeGen, Good Energy believe that the government’s scheme is treating long term micro-generators unfairly.

CEO of Good Energy, Juliet Davenport, announced:

“It’s outrageous that the new FiT only pays the highest reward to new generators – Good Energy believes that the early adopters of microgeneration technology should also be recognised for their pioneering attitude and taking a lead.

That’s why we’ve decided to continue paying our existing accredited HomeGen generators 15p a unit for all the electricity they generate and lobby to change the government’s mind.

It’s outrageous that the new FiT only pays the highest reward to new generators – Good Energy believes that the early adopters of microgeneration technology should also be recognised for their pioneering attitude and taking a lead. That’s why we’ve decided to continue paying our existing accredited HomeGen generators 15p a unit for all the electricity they generate and lobby to change the government’s mind.”

Answers to your questions…

The announcement of the feed in tariff has brought a lot of inquiries to the site in the last few days about how all of this is going to work. Thank you very much for submitting your comments, they are all very valid questions and some of them no-one seems to have answers to, as the process is ‘still being finalized’ apparently. I’d like to answer some of the key questions as best I can here;

Application process

We’ve had several questions about the application process for the FiTs and registration. At the moment this process appears to still be in discussion. The application for FiTs will be made through your electricity supplier. This could be E.On, EdF British Gas, Scottish and Southern Electric or any of the other major utilities. It could also be a specialized green energy supplier like Good Energy. Since it will be this electricity supplier that pays you the FiT, it makes sense that you make your application with them. If you want to switch electricity supplier to one that is more organized for paying out the FiT then that’s a perfectly valid decision.

Having spoken with the E.On ‘Solarnet’ team yesterday, I found out that will be unable to send out any information on how their process will work until March, but this is because they are still waiting for details from the government. I find this strange since E.On administers the feed in tariff to hundreds of thousands of solar energy producers in Germany, so they could provide some information to people in the UK.

I admit I haven’t spoken to EdF or the others yet so I’m not saying E.On is less organized than anyone else. If you are curious then call your electricity provider and see how they respond.

Once set-up the utility will check that your PV system is compliant with the microgeneration certification scheme (see previous post for details) and other regulations before granting yu the feed in tariff paid once every three months. It will be received as a completely separate payment from your electricity bills.

Applying for the feed-in-tariff is different from having your PV system connected to the grid which is another necessary step. This should be organized for you by your installer and requires a visit from the ‘Designated Network Operator’ (DNO) for your region to do the final grid connection. Without this step you can’t feed energy back to the grid.

Planning permission

The next question we have had is regarding planning permission. Recent government legislation has tried to make it easier for solar installations to get planning permission for solar systems but it is still essential to check if it is necessary with your local council’s planning department. Normally if you are not in a conservation area solar panels are classed as ‘permitted development’ so long as they do not rise above the roof height to be considered an extension. If you are in a conservation area you will likely need planning permission if the solar panels are visible from street level.

If you are building a new building, then having renewable energy can help you obtain planning permission. The Merton rule, which has been in place for several years now, states that 10% of a building’s energy supply should come from renewable sources.

Commercial buildings

The feed-in-tariff applies equally well to commercial buildings as it does to households. Therefore we expect business to start looking at solar as an investment just as much as households.

The export tariff

The export tariff is an additional 3 pence paid on top of the 29p-41p per kWh paid when you export energy to the grid. Since retail electricity prices are more than 3p, it makes sense to try to use this energy yourself if you need it, but if you can’t use it, you get the extra 3p on top. The system is designed like this to encourage own use of energy, since this causes less problems for the grid among other reasons.

Off-grid systems

A very good question we had was regarding off-grid systems. If live in a remote location and have solar panels connected to a battery and their energy without connection to the grid, can you still get the feed-in-tariff? The answer is yes, the feed-in-tariff does apply to you. You obviously will not be paid the 3p export tariff but you will offset energy requirements from other sources which should be worth more than 3 pence. You should get an MCS accredited installer to come round and fit it though.

How do I get started?

You can have a PV system is by contacting an MCS accredited installer of solar panels and an easy way to do that is by using this website to ask for a quote.