A guide to selling renewable electricity
30th August 2022
The UK is on a journey from fossil fuels to a renewable future. Drax provides a guide to creating revenue for your farm by generating and selling your own renewable electricity.
We’re moving from our reliance on single, large-scale power stations, towards a smarter energy grid based on smaller low carbon generators, working together to power the country. By generating and exporting your own renewable electricity, you can play a part in decarbonising the UK, while also generating income.
The road to generation
You might have heard of Power Purchase Agreements (PPAs). But if you’re new to generation, there are a few other steps you’ll need to take before you can profit from renewable energy.
The essential steps of the journey look a bit like this – read on for a breakdown of each stage.
Step 1: Install your renewable asset
Step 2: The Distribution Network Operator (DNO) creates an ‘export MPAN’ (Meter Point Administration Number)
Step 3: Get a Meter Operator Agreement
Step 4: Agree a PPA
Step 5: Register your MPAN
Step 6: Commissioning contract put in place
Step 7: Meters installed/reprogrammed
Step 8: Data Collection and Aggregation
Step 9: Payments start
Read on to understand more about setting up an MPAN, working with DNOs and the other requirements for self-generation. For the full step-by-step, download Drax’s handy guide.
Setting up your export MPAN
Every electricity supply in the country has an MPAN. This unique 13-digit code allows National Grid to reference and identify each electricity supply point.
To start exporting energy to the grid, you’ll need an ‘export MPAN’.
Registering and using your MPAN
- First, contact your DNO to get your export MPAN. (More on this under ‘Working with DNOs’). Registration is based on technical information about your generation which is shared with your supplier to get the right type of meter fitted or programmed.
- Once the MPAN is set up, your supplier puts a ‘spill contract’ in place, which provides data from your export site. Your supplier can then register the site with the Electricity Central Online Enquiry Service (ECOES).
- Your supplier(s) then work with the Meter Operator (MOP) to fit the appropriate meters. They’ll also share your MPAN with the Meter Point Administration Service (MPAS).
If you’re exporting power, suppliers need your meter to be set up to collect data on a half-hourly basis. This builds an accurate profile of your export volume.
‘Meter Operator Agreement’
MOP agreements are contracts that cover the supply and ongoing maintenance of any meters. They can also cover the telecoms service needed to send data to the Data Collector and Data Aggregator (DCDA) – more on that later.
Import electricity supplies will already have a MOP in place, so you can choose to expand that to include exported electricity. You can look for a new MOP, but you must have the same import and export MOP if the associated meters are related.
MOP contracts are usually for five years and cost around £250-600. They can vary based on technology types, geographic location of site, volume and voltage of the power connection.
Working with Distribution Network Operators
DNOs own and operate the wires, cables, transformers and other equipment that takes electricity from the National Grid network to homes and businesses. If you’re exporting electricity to the grid, your local DNO needs to know about it.
Your generator installer should notify the DNO within 28 days of commissioning your generating assets (your supplier won’t be able to register an export MPAN if this hasn’t been done).
Finding your DNO
The UK is largely shared between eight DNOs, divided by region, though there are also several independents (IDNOs) in the market.
You can find your DNO by searching your postcode.
Getting your data in order
The Data Collector and Data Aggregator are two further third parties, often the same company.
The DC retrieves the half-hourly meter readings from your sites, and the DA then aggregates it to meet industry standards so it can be shared with your supplier.
Why do you need a DCDA?
Validated data is crucial to ensure you receive accurate payments for your power and that your data follows industry procedures. DCDAs are mandatory for every half-hourly electricity supply, whether it’s gathered remotely from a smart meter or requires a site visit to download data from the meter.
Appointing a DCDA
You can choose your DC, but they must be accredited and are ultimately contracted to the supplier. The DA is appointed by the supplier to aggregate half-hourly data so it can be used for billing. All good suppliers can appoint a DCDA that covers both ends of the data process, with fixed fees.
Costs and timings
Every site is different, so there’s no set cost or timeline. But here’s what you’ll think about before you start generating income.
Fees to consider
- Metering – this varies depending on your generation technology type, your MOP contract and how often maintenance is needed
- Remote communication – it costs to send data between your meter and MOP. Again, these vary, but the benefit of half-hourly communications is prompt payments for your power
- DCDA – you can choose your own DC, or your supplier can appoint a DCDA that covers both ends of the data process with fixed fees.
Timings to factor in
The whole process can take anywhere from six weeks to well over six months. Factors include:
- Location – will the MOP and DC have to travel far to reach you?
- Technology type – a small solar array is simpler to connect than a complex anaerobic digestion unit in a remote area, or a wind farm that needs multiple meters
- DNOs – speed of MPAN approval can vary, affecting how quickly a supplier can register an MPAN
- Grid connection time
- MPAN and MOP services and contract agreements.
Want to know more?
Drax has a long history in supporting independent renewable power generators in the UK. Through our power buying scheme, it supports more than 2,100 renewable generators. The company can help you start generating and selling renewable electricity, whatever your technology, volume, or risk appetite.