The option to feed surplus self-generated energy into the national grid made sense when it was first introduced, but it has been overtaken by new possibilities. One important solution to increase efficiency and save energy is represented by energy communities.
Each country can offer a service to citizens and small businesses with a photovoltaic system that allows them to feed surplus self-generated energy into the electricity system, with an economic return.
But is this the best deal? Are there other, more efficient solutions to increase the yield of your photovoltaic system? Let’s consider the various aspects to understand which is the best solution.
Payment for energy fed into the grid
Economic considerations are essential when evaluating the benefits of net metering.
In Italy, the economic return for energy fed into the grid is known as a net-metering contribution and is issued yearly by the National Operator (GSE) in two instalments, an initial payment and a balance, paid at six-month intervals on the basis of monthly monitoring of kWh issued. This amount is calculated considering various factors, including the difference between energy input and withdrawn, the times at which energy is input and the location of the system. The net-metering contribution is between 30% and 40% lower than the actual value of energy that you feed into the grid because a significant portion of system charges and taxes are not applied and the prices used for calculation are set by the Operator.
In the UK and Australia, the amount paid depends on the individual energy company which you decide to use, both in terms of tariff and frequency. The differences between the two are:
- the UK has established a Government obligation to provide a minimum tariff greater than 0. This is not the case for the Australian federal government, which instead leaves individual jurisdictions to decide
- in Australia, the obligation to make a tariff offer is only valid for electricity companies with more than 150,000 customers. Smaller companies may can decide whether to follow the scheme or not, on a voluntary basis
In the UK, the majority of SEG (Smart Export Guarantee) tariffs currently offered are fixed, but flexible versions are also making ground, offered by certain “agile” retailers. Fixed tariffs, whilst stable and guaranteed, are around 50% lower than the cost of energy. Meanwhile, in the case of flexible tariffs, it is very important to pay attention to the time periods at which energy is fed into the grid, and therefore your energy-consumption style, otherwise the economic return will be lower than with a fixed tariff.
In Australia, the situation varies from state to state. The Feed-in Net tariff, equivalent to the UK’s SEG, is significantly more widespread than the Gross version because it offers a better deal. The Gross tariff features input of all energy produced into the national grid, and consumption of energy supplied from it. However, the Net tariff system is also lower than the value of energy input, by around 30%–60% depending on the state and the company’s specific offer.
All of this information helps us to understand the value assigned to these payments and therefore to your clean energy. From this brief assessment, it is already clear that individual and collective self-consumption are preferable, and even more so with the addition of storage systems, as they guarantee immediate and significant savings on bills.
Firstly, self-consumption allows you to avoid spending money on the energy that you consume, particularly if your installation is equipped with a storage system. This solution allows you to increase your average instantaneous self-consumption to up to 70%, and even up to 100% at certain times of the year.
Above all, collective self-consumption allows you to pay for the energy you receive from other members of your energy community at honest, fair and competitive prices, as the purpose of energy communities is not profit but collective environmental, social and economic benefits.
Energy wasted by net metering
This input of energy into the national grid can be considered a form of non-instantaneous self-consumption, as if you were using a virtual storage system. Yet in reality, traditional energy purchased from the grid reaches your homes after travelling long distances, with losses and therefore energy wasted during transport.
Similarly, the energy fed into the national grid does not have a pre-destined use, but is stored within the grid, with greater wastage compared to instantaneous self-consumption. So, whether energy is entering or leaving the national distribution grid, wastage will always be greater compared to energy produced and consumed in the same location.
Also in the case of collective self-consumption of energy communities, energy losses are minimal because self-consumption is instantaneous even though it is deferred: the exchanges of energy with other citizens via a smart grid is possible due to the different energy profiles of the energy-community members, which allows real-time balancing of consumption and a reduction of energy losses. In addition, exchanges always occur within the scope of the same transformer substation, and therefore within a limited range that ensures losses can be avoided.
To learn more about the energy savings of a solar-panel installation, we recommend reading this article.
The source of energy consumed via net metering
Where does energy come from if it is drawn from GSE, as in the case of net-metering agreements?
The Operator does not allow you to manage your energy freely and independently: net metering certainly does not guarantee consumption of renewable energy, such as that produced by your system, or that drawn from an Energy Community. In all probability, the energy you draw from the grid will originate from traditional sources, using raw materials that are not eco-sustainable in the medium or long term.
The best alternatives
By now it should be clear which is the best alternative.
The choice that can genuinely revolutionise your energy spending, in terms of both consumption and costs, is combining a solar panel installation with storage system and membership of an energy community. This will guarantee maximum value for energy fed into the grid and ensure you always have a supply, through instantaneous collective self-consumption.
Participation in the energy community model is also beneficial for those that haven’t (yet) installed a photovoltaic system: you can decide to purchase a storage system alone and play a role in the community by purchasing and storing energy in the role of storer, or you can simply be a consumer and purchase energy from members who produce it (prosumers), helping to maximise collective self-consumption. Whatever your choice, you will finally be consuming clean energy, without wastage, and with a tangible saving on costs.
Regalgrid® technology guarantees maximisation of individual and collective self-consumption both with a one-to-many (typical of apartment blocks) or a many-to-many architecture (typical of energy communities). Simply equip yourself with an SNOCU unit and access the Regalgrid platform for full real-time usage, programming and management functionality, for consumers and prosumers, and also for storers. Regalgrid technology therefore renders the net-metering approach obsolete, giving individual citizens and communities access to a series of new collective self-consumption possibilities, guaranteeing consumption of clean energy without the wastage associated with transport.