Could selling back to the grid be phased out?
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What is the main topic discussed in this episode?
The Clare Byrne Show on Newstalk. With Aviva Insurance.
Well, households with solar panels have been warned that the unit rate they get for selling excess electricity back to the grid is going to decrease. The Netherlands is scrapping its energy credit system for households from next year due to an increase in residential solar power that has created massive grid congestion. Now, experts in Ireland are warning that the same could happen here. Let's get more on this. I'm joined by Lisa Ryan, who's Professor in Energy Economics at University College Dublin. Good morning, Lisa. Good morning, Clare.
Why are feed‑in tariffs for residential solar expected to drop?
People who have solar panels love to tell you about the electricity they sell back to the grid. Do you think that that is a system that may come to an end?
Well, this is something that's been discussed in many parts of the world where they're ahead of us in solar, for example, in Australia or in California, where they have a huge amount of rooftop solar. And it is something that, yes, probably will be looked at again in Ireland as well as everywhere else. I mean, if you look at what companies pay customers, you know, if you're selling back to the grid, most companies offer about 19 cents a kilowatt hour. So what we pay for our electricity bills is around 38 cents a kilowatt hour. So already the best use you can put your solar generation to is just to use it yourself directly. You're getting your. getting double the value by actually just using it directly in your own home rather than selling it back to the
grid. But if you're an energy supplier, is the 19 cent not a pretty good deal if you're selling it at 38?
Not really, because the 38 cents that we pay, you know, only about 10 cents of that actually is the cost of the electricity generated. So in fact, we're already being overpaid usually with our 19 cents kilowatt hour. If you break down what an electricity price is made up of, it's about a third from the electricity generation. So on the wind farm or wherever the electricity is coming from, then a third on taxes and a third on just the grid costs. So getting 19 cents, we're getting more than what it would cost the electricity suppliers to buy it on the market.
So they're getting it for 10 cent on the market and they're getting it for 19 cent from the people who have solar panels. So it makes no sense for the energy companies, really.
Not really. I mean, it depends what that electricity market price is. As you know, it's been very volatile in the last few years, so maybe higher than 10 cents or could be 15 cents.
How does the current 19¢ /kWh feed‑in rate compare to the 38¢ /kWh electricity price?
But yeah, from an electricity supplier perspective, You know, I think these tariffs were introduced, these kind of payback feedback tariffs were introduced to kind of provide an incentive for people to put in solar PV. They were also, I think, pressurized to introduce them. It's a bit of competition in the market. But really, from their perspective, they would just prefer if we use that electricity in the home. I mean, often what, like, you know, if you think about the overall electricity system, Usually we don't really need that electricity from the solar PV that much because it comes in the middle of the day. And if you think of the peak demand in the Irish electricity system, it's in wintertime at five o'clock in the evening when solar, you know, really has no help to you at all.
And that's where the electricity system will be crying out for some additional supply into the system. But none of us provide that. The only thing we could do is try and divert some of this. So if we generate in the middle of the day, especially in winter, obviously that window is very, very short. It's dark at four o'clock. If we can put in a water heater that we might use to heat up our water in advance of that peak period, or people have batteries, or if you have an electric vehicle, they're very big batteries, essentially, that if you were at home, you could charge up your battery with your solar PV. And then that would store electricity. And in the future, then you'd be able to feed that back in from your car if it was outside your house, would be a battery that you could use then also for your electricity in the evening as well.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:01–0:37
2
Why are feed‑in tariffs for residential solar expected to drop?
0:37–2:35
3
How does the current 19¢ /kWh feed‑in rate compare to the 38¢ /kWh electricity price?
2:35–4:28
4
What role do batteries and hot‑water storage play in maximising solar self‑consumption?
4:28–7:00
5
Can households store excess solar power themselves instead of relying on the grid?
7:00–9:51
6
Is Ireland heading towards the same grid‑congestion problems the Netherlands faces?
9:51–11:34
7
Is it still financially worthwhile to install solar panels if feed‑in payments disappear?
11:34–13:10
8
How can smart meters and energy‑management apps help homeowners optimise usage?
13:10–14:04