Generate surplus energy with solar panels

With rising energy costs, more and more households are turning to solar power “autoconsumo”. It is a very convenient and economical solution for long-term electricity self-sufficiency.

It is also good for the planet, generating 100% clean energy.

What is self-consumption (autoconsumo)?

Self-consumption is a way of producing your own electricity for personal consumption in your own home. In the case of solar photovoltaic self-supply, the energy is generated by solar panels.

Harnessing solar energy is a more and more common option, as the trend is to move towards green energy, without the need to exploit non-renewable natural resources such as coal or oil.

The solution is very popular in Spain since in our country we have approximately 300 days of sunshine out of 365, which means an almost uninterrupted energy production throughout the year.

In addition, we have high solar irradiation, which means that the production capacity is higher compared to other areas of Europe, for example, Germany or Holland, where residential self-consumption has a much higher penetration than in Spain, despite having far fewer hours of sunshine.

How does solar electric self-consumption work?

The way self-consumption installations work may seem complicated at first, but once you know all the details, you will see that one advantage of self-supply is its simplicity.

First of all, we are talking about the sun’s energy, which is transformed into electrical energy by means of solar panels.

The direct current produced is converted into an alternating current by the solar inverter. This energy is used for the self-supply of the house.

To better understand how photovoltaic electricity self-consumption works, it is necessary to know what types exist.

Types of solar self-consumption

There are several types of solar self-consumption, depending on the location where the system is installed or whether it is connected to the grid or not.

These are detailed below.

Residential connected or isolated

Residential self-consumption is divided into grid-connected and off-grid self-consumption (also known as isolated).

We can also talk about self-consumption with or without surpluses fed into the grid.

In the case of grid-connected self-consumption, the installation will have two connections: one to the home’s electricity system and the other to the distribution network, owned by an electricity company.

Isolated self-consumption, on the other hand, involves total disconnection from the distribution grid. This second option implies that, if there are no batteries or energy storage, the house will have no electricity.

Moreover, batteries are often not sufficient and in these cases an electric generator will be needed. All of this means a higher investment for the customer and a higher risk for the customer of running out of electricity, as opposed to being connected to the grid.

And what happens with the surplus energy produced in these two situations?

In the case of connected self-consumption, the energy can be fed back into the grid, obtaining compensation for the surplus. If the installation is isolated, the energy can be stored in batteries and the owner of the installation can dispose of it at any time.

Depending on the needs and what each homeowner is looking for, one or the other can be chosen.

However, it must be taken into account that in periods of low photovoltaic production, the stored energy may not be sufficient to supply the house. That is why we recommend keeping the house connected to the electricity grid.

It is also possible to opt for a grid-connected system without surplus compensation, but this option does not help to maximise the profitability of the system.

The concept of surplus compensation will be explained in more detail later on.

 

Individual or shared self-consumption

If we talk about types of self-supply installations, it is also worth mentioning that these can be for individual use or for shared use.

Shared self-consumption, as the name also indicates, is when several homes or a community of neighbours are connected to the same installation.

This type of installation is less common since measuring the consumption of each home is complicated.

In neighbourhood communities where there is a system installed, it is usually used for common areas such as the corridors of the building, garages or motors for the swimming pool, while individual self-consumption is the one that supplies single-family homes.

 

Industrial or business

This form of energy generation is not only limited to residences. Industrial self-consumption is an option that more and more companies are considering. Their operation remains the same and, as in the case of residential, companies benefit from savings on their bills.

Photovoltaic installations for businesses differ from residential installations mainly in the following ways:

  • The size, which is usually much larger
  • Energy consumption
  • The hours at which energy is consumed tend to be during daylight hours, as opposed to a residence where energy consumption patterns are created throughout the day.

What is the simplified compensation mechanism?

Under the planned economic regime, in the self-consumption supply with surplus, the producer may sell surplus energy or use the simplified compensation mechanism.

The latter is a mechanism designed so that small renewable consumers of up to 100 kW can offset the energy consumed through the grid with the surplus energy that they do not consume at a given time. This mechanism allows deferred consumption over the billing period of the energy generated.

What are the requirements to qualify for the simplified compensation mechanism?

Those consumers who are eligible for the simplified compensation mechanism are eligible:

  • Are associated with production facilities whose capacity does not exceed 100 kW.
  • The generation is of renewable origin.
  • The production plants have not been granted an additional or specific remuneration regime.

The elements of a solar self-consumption system

Now that you know what it is, how it works and what the types of self-consumption installations are, it is worth reviewing the elements that make up these systems.

There are 4 basic elements:

  • The solar panels
  • The solar inverter
  • The support structure
  • The wiring

Without them, the self-consumption system cannot be set up.

In addition to this, other elements such as power optimisers, energy meters or storage batteries can also be included.

You can also choose to include devices such as electric car chargers. Let’s detail the key elements for the installation: solar panels and inverters.

Compensation of surpluses

In addition to the subsidies that can be obtained for the photovoltaic system, surplus compensation also adds to the profitability of self-consumption.

Surplus compensation is a benefit that can only be obtained in the case of grid-connected self-consumption systems.

In practice, the surplus that a system produces but does not consume is fed into the electricity grid and is compensated for this. In general, it is not the important part of the savings, as is self-consumption. Dumping of surplus can account for 10-15% of the total savings.

Keep in mind that surplus compensation is not a business.

Oversizing the system will not help you save more on your electricity bill.

Electricity companies compensate the kWh fed into the grid until the variable part of the bill reaches 0. After that, the energy will be discharged free of charge.

It is very important to have a well-dimensioned system in order to have the highest possible profitability. In addition, the price at which the kWh is bought is not the same as the selling price. Normally this compensation is around €0.06 per kWh for other companies, but here at Energy Nordic, we compensate you with the market rate of the price given by your distributor per kWh to ensure you get the very best rate for the energy you produce!

From our recent prices in September/October 2022, our clients’ surplus consumption averages at 0.09€ per kWh.*

*Please note, this is not a fixed rate, this is based on an average of the market price for solar surplus compensation for our clients in Spain in September/October with residences with registered “autoconsumo” installations, as always, prices are subject to vary.

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