July 2010

The self-consumption bonus

Information and details regarding the self-consumption of solar energy

Solar power plant operators do it every single day, most notably around noon time: They consume the electricity their plants generate. The result: self-consumption. The reason: physics. These facts didn’t change, the only new thing is that self-consumption is both favored and promoted by lawmakers.

Whereas in the past compensation for feeding-in solar energy has been completely detached from the energy consumption, the coordination of consumption and generation is now becoming increasingly important, especially following the German Bundestag's amendments to the Renewable Energy Sources Act (EEG) in early May. Through a combination of reduced monetary compensation, payable sales tax and saved power purchasing costs, operators should end up receiving up to 9.5 cents more for each kilowatt hour of solar energy they consume instead of feeding it to the public grid (depending on the amount of self-consumption and with an assumed electricity price of 23,8 cents incl. VAT).
Self-consumption is consequently becoming a key issue when discussing the profitability of solar power plants. The big questions are therefore: How much self-consumption can an average home achieve under normal circumstances, i.e., without taking any additional measures? And what solutions are capable of increasing the amount of self-consumption?

"Natural" self-consumption in a private home

To determine self-consumption, the average consumption of solar energy must be compared with the amount of energy generated by the solar power plants. Consumption depends on how many and what kind of electrical appliances are used as well as the number of people living in the household and what their consumer habits are. The amount of generated energy, on the other hand, depends on the power and location of the PV plant as well as the prevailing weather conditions.
Figure 1 illustrates the generation and consumption of energy from a 5 kWp solar plant and a four-person household on a typical summer day. The generation capacity curve (gray) generally takes the shape of a bell curve on clear days. The consumption load curve (blue) indicates typical load peaks at noon time with other consumption peaks in the morning and evening hours. The amount of solar energy directly consumed corresponds to the portion of consumed power (blue areas) that is "inside" the generated PV energy (light gray areas). That amount is depicted as dark blue in the figure.
SMA has performed extensive analyses to determine average self-consumption rate. Result: In a four-person household, self-consumption as a share of the total amount of generated energy is about 20 to 40 percent per year (Fig. 2).

Fig. 1: Generation, consumption and self-consumption on a clear summer day (four-person household and solar power plant with 5 kW peak power)
Fig. 2: The amount of "natural" self-consumption depends on the power of the solar power plant and the number of people in the household

Background: Why promote self-consumption?

The reason for promoting self-consumption is to lessen the burden on regional medium and low voltage grids. At least until further progress is made in building a modern power grid, which is capable of distributing fluctuating amounts of energy in all directions and with very little loss.
Self-consumption lessens the burden on power grids in two respects: Energy that is consumed at the same location where it is generated no longer has to be transported over the grid. In addition, energy needed for consumption does not have to be purchased via the public power grid. One of the reasons why self-consumption is so effective is that it highlights one of the special advantages of photovoltaic systems: the good correlation between power generation and energy demand over time. As an example of this correlation, solar power plants supply the most power at midday, which also happens to be the time when power is needed the most.
Aside from its ability to lessen the burden on power grids, self-consumption can generally be viewed as a future-oriented issue - especially in light of the so-called grid parity that will be achieved in Germany over the next couple of years: For once the cost of solar energy is equal to or less than the cost for conventional energy from a wall outlet, it makes sense for each solar power plants owner to use as much self-generated energy as possible.

The limits of "natural" self-consumption

This subject raises the question regarding the 60 to 80 percent of energy for which the time of generation and consumption are not congruent. They result from seasonal effects on the one hand and the daytime availability of solar power on the other. For example, in winter the demand for electric energy generally increases while the generation capacity decreases and in summer the opposite holds true. And each day brings energy requirements that cannot be met with solar power alone - whether for cooking or watching television in the evening of making breakfast at 7 am in the morning.

Increasing self-consumption

It is nevertheless possible to increase the amount of self-consumption that is automatically present in private households. The easiest way to do that is to change consumption behavior: Whoever shows initiative and only uses major electrical appliances during hours of strong irradiation can increase their share of self-consumption by up to ten percentage points.
The number of appliances that can be switched on at the same time is of course limited by the current power of the PV plant - switching on too many appliances will result in "wasted" potential for self-consumption. Major electrical appliances should therefore be started successively rather than simultaneously. Specific example: Do not switch on the washing machine at the same time as the dishwasher or oven. Instead, switch them on one after the other or let them run in a time-delayed manner. To this end, a convenient monitoring solution for displaying the current solar power such as SMA's Sunny Beam remote display is extremely helpful.

Support through technical solutions

Combining the power monitoring device of a PV plant with an electric switching apparatus allows for the implementation of automated solutions for increasing self-consumption. The same basic rules apply here as well: Only switch on appliances if power is available in sufficient quantities and is not being used for other purposes - otherwise switch them on later or one after the other. To this end, such systems should not only be able to determine their power generation, but also their current rate of power consumption. Otherwise there is a risk that appliances which are currently running and which consume all or just some of the available PV power will be ignored. In the worst case scenario, an aditional peak load would be generated and exceed the amount of energy supplied by the PV plant - the connected appliance would then have to draw at least a part of its energy from the grid.
An effective technical solution would therefore not only record PV power, but also monitor the feed-in counter. After all, the feed-in counter measures the amount of generated energy that is not consumed in the household itself. If energy is fed into the grid, then PV power clearly exceeds consumption - additional appliances can be switched on. A product solution based on this functional principle will be introduced by SMA at the upcoming Intersolar trade fair.

The intermediate storage of PV power with battery systems will also offer an appealing choice in the medium term. For whoever is able to select any given time when PV power is to be consumed, can also significantly increase their self-consumption. An advanced technical solution for this purpose is already available with the Sunny Backup System by SMA. With a software update and an additional meter interface it can increase the self-consumption rate significantly — aside from the actual function of the fail-proof energy supply (Fig. 3). Another advantage: Almost any PV plant can be retrofitted with a Sunny Backup set provided the system is equipped with PV inverters from SMA.

Fig. 3: High tech for maximum self-consumption: SMA's Sunny Backup System

Conclusion: Self-consumption is becoming increasingly important

The fact is that self-consumption has become an important criterion for planning and designing solar power systems in Germany and has a significant effect on their return on investment. Whoever bears that in mind and takes advantage of the opportunities provided by the EEG will be better equipped to deal with the planned reduction in solar power subsidies while at the same time help to lessen the burden on the power grid infrastructure.
The optional self-consumption can benefit just about anyone: Depending on system power and the number of household members, a "natural" self-consumption rate of 20 to 40 percent of overall generated power can be achieved. By changing consumption behavior or using existing switching functions, that percentage range can be increased by an additional ten points. The automated activation of appliances through intelligent energy management can also help increase self-consumption provided that both power generation and current consumption are taken into account.

Background: General conditions (commissioning between 1.1.2009 and 31.3.2012)

Fig. 4: Meter configuration for measuring self-consumption

According to Section 33 of the EEG, January 1, 2009, is the cut-off date for grid-connected PV plants. Regarding connection data, a power limit of 30 kWp was in effect until July 2010 and then increased to 500 kWp thereafter. The self-consumption option applies to each kilowatt hour of solar energy that is consumed in the immediate vicinity of the PV plant that generates that power. To measure self-consumption, three different meters are required: a PV meter for generated solar energy, a feed-in meter and an electricity meter for the purchased energy. Note that the last two can be combined into a single bidirectional meter (Fig. 4). 
Self-consumption that is compensated separately is based on the difference in the data collected by the PV meter and the feed-in meter. The feed-in meter therefore only measures the "excess" solar power that is not consumed directly, but rather fed into the grid and compensated accordingly. A supplement to the technical connection requirements from October, 2009, determined that the meters do not necessarily have to be installed in a central location. As a result, the PV meter no longer has to be installed next to the existing meters. 
An additional benefit for operators: They can opt in or opt out of self-consumption at any time during the 20-year EEG subsidy.

Prospects: Self-consumption for commercial consumers

In addition to the circumstances evaluated here with respect to private households, self-consumption can also be an appealing choice for commercial consumers. One reason can be found in the power limit for exercising the self-consumption option - the limit of 30 kWp was increased to up to 500 kWp during the amendment of the EEG. It should however be noted that commercial consumers are difficult to categorize since their individual consumption behaviors can be vastly different. If there is a high baseload demand, which refers to a consistently high energy demand throughout the day, a very high self-consumption rate is conceivable. SMA has addressed this topic in much greater detail in a different article.

Notice

The article on self-consumption for commercial purposes can be found here.

Content

  1. "Natural" self-consumption in a private home
  2. Background: Why promote self-consumption?
  3. The limits of "natural" self-consumption
  4. Increasing self-consumption
  5. Support through technical solutions
  6. Conclusion: Self-consumption is becoming increasingly important
  7. Background: General conditions (commissioning between 1.1.2009 and 31.3.2012)
  8. Prospects: Self-consumption for commercial consumers
  9. Notice