The smart export guarantee for small-scale renewable generators should include a “fair minimum price” that is higher than zero, the Renewable Energy Association (REA) has argued.

The scheme, which will replace the feed-in tariff following its closure at the end of March, will require all suppliers with 150,000 domestic customers or more to provide at least one export tariff for eligible generators. But they will only be obliged to offer a rate that is “greater than zero at all times of export”.

REA chief executive Nina Skorupska said: “Whilst we are fully supportive of encouraging innovation in tariff design we still believe that the policy should introduce a fair minimum price for generators. Minimum contract lengths should be required to give future generators certainty. These proposals do not ensure this.”

In its response to a consultation on the proposals, the REA said participating generators should be paid based on an index of the system imbalance price – the amount it costs the electricity system operator to balance the power grid during each half-hour settlement period.

The lobbying group said the minimum price could be set at 90 per cent of the index to leave a profit margin for suppliers. This would be “more or less in line” with the export element of the feed-in tariff and well below retail prices.

Nevertheless, Skorupska welcomed the announcement earlier today (10 June) that the government intends to implement the smart export guarantee by the end of 2019: “Small scale renewable power deployment is good for businesses, good for homes, and good for our climate.

“The government confirming that they will legislate for a smart export guarantee is very positive and acknowledges innovation in the market, how the falling price of batteries and renewable energy can support lower bills, and how local generation and storage can reduce grid constraints.

“There is growing popular demand for technologies such as solar and battery storage. The linking of this policy to the Microgeneration Certification Scheme is welcome and will help ensure a measure of consumer protection in this new era of deployment.”