Minister Ryan announces launch of the second phase of the Small-Scale Renewable Electricity Support Scheme (SRESS)
The second phase of the Small-Scale Renewable Electricity Support Scheme (SRESS), the export phase, has now been launched. This phase of the electricity support scheme will be a significant improvement in market supports for Renewable Energy Communities and Small and Medium Sized Enterprises (SMEs), with fixed tariffs for these groups established for solar and wind projects between 50kW to 6MW. It complements the microgeneration supports for small projects and competitive auctions for larger projects under the RESS (Renewable Electricity Support Scheme).
SRESS tariffs have been set across six categories – three community rates and three SME rates, covering both solar and wind. The largest supported category, grid scale community solar projects, will receive a guaranteed tariff 20% higher than the average community price in the most recent RESS auction for community projects in 2022.
- Initial volumes supported and tariffs will be kept under review to ensure that impacts on energy affordability for households and businesses are limited, and that tariff levels align with project development costs for communities and SMEs. Further volumes will be offered subject to review and uptake levels
- SRESS will offer supports for renewable electricity installations which are not as suited to other support measures, such as the utility scale Renewable Electricity Support Scheme (RESS) and the Micro-generation Support Scheme (MSS)
- SRESS aims to provide an easier route to market for community projects while also enabling farmers, businesses, and others to maximise their participation in the energy transition
The Minister for the Environment, Climate and Communications, Eamon Ryan, said:
“I am delighted to announce the launch of the second phase of the Small-Scale Renewable Electricity Support Scheme (SRESS).
“SRESS is a key building block of the government’s solar strategy and forms part of our comprehensive enabling framework for renewables self-consumers. SRESS will offer supports for renewable electricity installations which are not as suited to other support measures, such as the utility scale Renewable Electricity Support Scheme (RESS) and the Micro-generation Support Scheme (MSS) – essentially filling the gap between those two schemes.
“Communities play an important role in our transition to a greener future. Through my department’s continued engagement with Renewable Energy Communities, it became evident that they were facing significant challenges with the competitive, auction-based nature of RESS, along with grid and other barriers to project delivery.
“To alleviate these issues, SRESS has been designed with the aim to provide an easier route to market for community projects and will align more closely to the experience and capacity of the community energy sector. SRESS will also enable farmers, businesses and others to maximise their participation in the energy transition. SRESS will help to deliver on Ireland’s renewable energy targets. These include a target of 80% renewable electricity by 2030, including 8GW of solar PV and 500MW of community energy over the same period. SRESS will be a key building block to the delivery of solar generation in particular.”
Phase One of SRESS was launched in July 2023. It offers grants for renewable self-consumers above 50kW and up to 1MW through the Non-Domestic Microgen Scheme and the Business Grants and Supports Scheme.
Renewable self-consumption refers to energy generated on a premises for that premises’ own consumption. Self-consumers can also store or sell excess self-generated renewable electricity, provided that, for a non-household renewables self-consumer, those activities do not constitute its primary commercial activity.
The support provided to date through Phase One of SRESS has been a success story in delivering solar rooftop installations at pace. 980 applications with committed costs of €17.6 million have been approved, amounting to a total installation capacity of 88MW.
SRESS can contribute to lower, long-term energy costs for both households and business against high energy costs, through lower wholesale electricity prices associated with renewable electricity generation relative to the equivalent fossil fuel generation.
Tariffs are being recommended based on findings of a report commissioned by the Department of the Environment, Climate and Communications to provide a revision of the levelized cost of energy estimates required for small scale and community-based generation, along with submissions received through a public consultation in Q3/Q4 of 2022. The consultation details and supporting material can be found on the department’s website.
SRESS will be operated on the basis of a policy lifetime out to 2030 and a 15-year support lifetime for successful applicants. It is intended that the scheme will be open for applications on a continuous basis, to be determined under the terms and conditions of the scheme. The terms and conditions for the scheme will be finalised in the coming months, with applications opening later in the year.
The scheme has two support mechanisms to suit two distinct cohorts of applicants. The supports mechanisms have been launched as two phases:
- Phase One: Renewables self-consumers above 50kW and up to 1MW. Phase One was launched in July 2023, with SRESS grants becoming available for renewable self-consumers above 50kW and up to 1MW through the Non-Domestic Microgen Scheme and the Business Grants and Supports Scheme.
- Phase Two: Community/SME projects between 1MW-6MW. Phase Two will support export-focussed small-scale and community renewable projects – primarily in the 1MW to 6MW range. This cohort is to be supported via a feed-in tariff for the duration of the scheme. In addition, export-only projects (that is, those renewable electricity generation projects which are not renewable self-consumers) below 1 MW will also be supported under this category.
The department will finalise the detailed terms and conditions for the scheme later this year, with the scheme then due to come into operation.
The SRESS tariffs will provide support to small-scale renewable electricity projects through a guaranteed tariff. This tariff will be characterised by a Feed-in Premium (FiP) tariff without an auction. The support rate will be provided for the support lifetime, with successful applicants receiving a premium on the market revenues they receive from a supplier for their renewable electricity. It is proposed that applicants to the scheme will receive a letter of offer, entitling the electricity supplier who enters into a Power Purchase Agreement (PPA) with the successful applicant to receive SRESS support through the Public Service Obligation (PSO). This is a similar mechanism as exists currently under the RESS.
A different rate will be provided, depending on whether the project is a Small and Medium Sized Enterprises (SME) or a Renewable Energy Community (REC). A higher rate is provided for RECs due to the additional barriers they face when establishing projects such as planning, grid connection and financing; plus it is a reflection of public policy preference for community involvement in renewable energy projects, including Climate Action Plan targets of at least 500MW of local community-based renewable energy projects by 2030.
The above-mentioned premium tariff for export-led projects is a two-way tariff. This means when the mentioned support price exceeds actual market revenues received, generators will receive the support price from the relevant supplier, who will in turn be due SRESS support (from the PSO), for the value of the difference between the market value of the electricity and the support price.
Alternatively, when market revenues received by the SRESS applicant exceed the support price, applicants will continue to receive the support price, and a difference payment will flow from the relevant supplier to the PSO fund. This will help to protect electricity customers from high electricity prices, by ensuring that projects are not over-compensated and contribute monies back to the PSO at times of high-electricity prices.
The tariffs provided are for solar and wind, as it is expected that the overwhelming majority of interested applicants will comprise of these two technologies. As the scheme progresses, the possibility of expanding the range of tariffs to include other technologies will be considered.
A key objective of the SRESS is to provide a simpler route to market for Community projects than the competitive RESS auction process. Feedback from community projects suggested that milestones were challenging for community projects to achieve in the Renewable Electricity Support Scheme (RESS). The Small-Scale Renewable Electricity Support Scheme (SRESS) aims to provide an easier route to market for community projects, without any competitive auction, while also enabling farmers, businesses and others to maximise their participation in the energy transition. Community projects that are 100% community owned, which were successful in RESS but were unable to achieve the milestones due to various challenges, will be eligible to apply for SRESS.
As is the case with RESS, SRESS projects will be required to establish a mandatory Community Benefit Fund. Community Benefit Funds are used for the wider cultural, environmental and economic well-being of the local community. The funds are intended to enable the local community to share in the benefits of renewable electricity generation.
Farmers are also eligible to partake in SRESS in the same way as general SMEs are. Therefore, they can apply for SRESS for export projects up to 6MW.
SRESS completes a now wide range of options, that enables the public and other entities to participate in the delivery of renewable electricity generation. These schemes are outlined below.
The Renewable Electricity Support Scheme (RESS) is one of the major government policies to help deliver on Ireland’s ambitious climate and energy targets. RESS is an auction-based support scheme which invites grid-scale renewable electricity generation projects to compete to receive a guaranteed price for the electricity they generate under a two-way floating feed in premium.
Phase One of the Small-Scale Renewable Electricity Support Scheme (SRESS) was launched in July 2023. It offers grants for renewable self-consumers above 50kW and up to 1MW through the Non-Domestic Microgen Scheme and the Business Grants and Supports Scheme. Renewable self-consumption refers to energy generated on a premises for that premises own consumption. Phase Two of SRESS, which has now been launched, supports export-focussed small-scale and community renewable projects, from 50kW up to 6MW. This cohort is to be supported via a feed-in tariff for the duration of the scheme. The department will finalise the detailed terms and conditions in the coming months, with applications opening later in the year.
The Micro-generation Support Scheme (MSS) provides support to domestic and non-domestic applicants for renewable installations through grants provided by the Sustainable Energy Authority of Ireland (SEAI).
The Targeted Agriculture Modernisation Scheme (TAMS 3) Solar Capital Investment Scheme (SCIS) is for renewable self-consumers, from 1kW to 62kW. The TAMS 3 scheme, in general, provides grants to farmers to build/install and/or improve a specified range of farm buildings and equipment on their holding. The TAMS Solar Capital Investment Scheme encourages the purchase of solar PV investments for contribution towards farms own electricity self-consumption, thereby reducing dependence on fossil energy. The self-consumption on farm holdings of solar PV generated electricity is further enhanced by the provision of grant aid under the scheme for the installation solar PV batteries for the storage of this electricity for later use, and thereby further offsetting the importation of electricity from the grid.
