Up to now surplus energy produced by wind turbines was just dumped on to the grid for free. Given the fact at night when many business energy usage is low, over 50% of the energy produced may have been transfered to the national grid free of charge. Even if your business used part of the energy at night, you are replacing night rate electricity which costs just 7c/kWh. ESB group have now changed their position in recent times and will now pay for the power produced.
The process works by connecting a wind turbine to the National Grid at your facility (factory, hotel, office etc.). Current CER (Commission for Electricity Regulation) grid connection rules state that a wind turbine can ‘spill’ power back to the National Grid up to a limit of 500kW. However, in special cases, depending on the site’s infrastructure, this may be increased. Effectively your business is using the turbine to power its own plant first and then any excess power can be sold for additional revenue. This type of self-generation is known as Auto Production and falls under the group processing scheme.
There are a few important considerations you should make in order to calculate how much you can expect to save on electricity each year.
If you install a wind turbine, you are more than likely going to do it by becoming an autoproducer. An Autoproducer is defined as someone who generates and consumes electricity at single premises, essentially for their own consumption. At the moment in Ireland multiple clients cannot be supplied from the same wind turbine installation.
When a wind turbine is connected on-site, if the load is equal to or greater than the output of the turbine, there will be zero export with all energy being consumed on-site. At times of low load such as night time and or weekends when the wind turbine output is greater than the load, the excess is exported. Ideally, an autoproducer would consume 70% to 100% of the energy produced on-site. This is because for every kWh they generate and use, they make a saving of 16-18 cent.
To encourage investment in wind energy that will bring Ireland to its renewable electricity target of 40% by 2020, the government created the REFIT 2 support programme. The Renewable Energy Feed in Tariff (REFIT2) support scheme operates by guaranteeing new renewable generation a minimum price for electricity exported to the grid over a 15 year period. In Ireland, Autoproducers are generally allowed to export up to 500kW. REFIT 2 is not payable for electricity generation consumed onsite.
The table below illustrates payments available under this scheme. Click to enlarge
Example 1: 300kw wind turbine using 100% of electricity generated
Your wind turbine would produce approximately 655,500kWh per annum (Depending on factors such as wind speed). If you are paying 16 cent per kWh, this equates to a saving of €104,880, if you are using 100% of the electricity you generate.
Example 2: 300kw wind turbine using 70% of electricity generated
For example, your site may have a load of 458850kWh per annum. In this case you will be exporting 30% back to the grid, which is 196,650kWh. The market rate per kWh sold back to the grid at the moment is approximately 6.5c per kWh (€65 per MWh). This will earn you €12,782.25 when sold back to the grid in addition to your saving of €73,416 on electricity. Furthermore, in this case, you can claim an additional 9.90 per MWh (.0099 per kWh). This is a monetary saving of €1,947. The amount of money earned by a 300kW wind turbine at 70% capacity in this example is €88,145 per year.
So as you can see from the examples above, installing a wind turbine through the autoproducer route makes perfect business sense. However, it is worth noting that the higher your capacity the greater the savings per annum and the quicker your project will reach payback. What is evident is that the Irish government could be doing more to support wind energy and renewables, especially compared to the UK and Northern Ireland feed in tariff of 24p per kWh.
The scheme is open to new plants built and operational between 1/1/2010 and 31/12/15 that can fulfil the terms and conditions including planning permission and grid connection.
If you are considering becoming an autoproducer, Enerpower offer a number of services you may find helpful.
Contact us on +353 051 364 054 for more information or email us directly below.