Jurisdiction: England, Scotland, Wales
Commencement: Articles 2 and 5 come into force on 1st October 2019. The remainder of this Order comes into force on 1st January 2020.
Mini Summary
This Order introduces the Smart Export Guarantee (SEG) which provides for payments to be made to generators of small-scale low-carbon electricity when they export it to the grid.
Summary
This Order introduces the Smart Export Guarantee (SEG) which instructs large electricity suppliers to pay generators of small-scale low-carbon electricity, when they export it to the grid. This is to support the renewable energy industry.
It partially replaces the Feed-In Tariffs (FIT) scheme, which ended in March 2019.
Note: The licence modifications of electricity distribution and supply companies is covered under the Energy Act 2008 in Sections 41 (1)-(3).
Duties
Electricity suppliers
Electricity suppliers with more than 150,000 domestic customers are required to offer a price for the surplus electricity supplied to the grid by low-carbon electricity generators. The price is set at above 0 pence per kWh, provided that the amount exported is metered and registered for settlement. A set price is not prescribed.
Remuneration applies to low-carbon generators with a maximum capacity of 5 megawatts (MW) of total installed capacity.
Anaerobic digestion
The Gas and Electricity Markets Authority, which is responsible for administering the SEG, has particular duties where electricity is generated via anaerobic digestion (AD). These are to verify:
- whether the SEG generator meets sustainability and feedstock requirements set out in the Schedule; and
- Whether the SEG generator continues to meet the criteria on a quarterly basis in relation to the sustainability criteria, and on an annual basis in relation to the feedstock criteria.
This means electricity suppliers using AD to generate electricity and seek SEG payments with respect to that AD plant have corresponding duties to ensure the plant meets sustainability and feedstock criteria and to provide the required information to demonstrate this to the Authority.
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