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Feed In Tariff Scheme (FITs)
On 1st April 2010, the UK Government launched the Feed-in Tariff (FITs) or 'Clean Energy Cashback' Scheme.
FITs is a great way to make money from excess electricity generated by your solar PV system. The Feed in Tariff offers a guaranteed tax free minimum payment from energy suppliers for the green electricity you produce. You receive a payment for all of the electricity that your system generates; even if you use that energy yourself!
The Feed In Tariff scheme is an incentive for households and green communities to invest in installing renewable technology. By generating their own electricity from renewable technologies, such as solar panels, households and green communities are entitled to a guaranteed minimum payment from their energy supplier for the electricity they produce.
Updates - Feed In Tariff Changes
You may have heard on the news that the government has announced changes to the feed in tariff (FIT). These changes involved cuts to the tariff for new Solar PV installations, meaning that the rate received was reduced by 50% for all installations from December 12th 2011.
Recently, the High Court ruled this change as “unlawful”. The Government appealed against this decision but was denied the hearing. The Government have now decided to appeal directly to the Supreme Court, and a decision is yet to be made.
|
System Size |
Tariff rate for installs before March 3rd 2012 (p/kWh) |
Tariff rates for installs post March 3rd – April 1st 2012 |
|
<4kW |
43.3 |
21 |
|
4-10kW |
37.8 |
16.8 |
|
10-50kW |
32.9 |
15.2 |
|
50-150 kW |
19 |
12.9 |
|
150-250kW |
15 |
12.9 |
|
250kW-5MW |
8.5 |
8.5 |
If you install and register your panels before March 3rd 2012
Currently, the FiT tariff has returned to its original rates for all installations before March 3rd 2012. These rates will be applicable for the full 25 years eligibility period of your installation.
However, if the Government wins their appeal in Supreme Court, it is likely the lower FIT rate of 21p kW will apply to your installation from 1st April 2012, and you will only receive the 43.3p kW for your generation output before 1st April 2012.
If you install and register your panels between 3rd – 31st March 2012
The government has confirmed that the rate of 21p kW announced as part of the consultation in December 2011 will apply to installations registered between 3rd and 31st March 2012. This means you will receive 43.3p kW from 3rd to the 31st March 2012, but this will reduce to 21p kW on 1st April 2012 for the remainder of the 25 year eligibility period of your installation.
If you install and register your panels on or after 1st April 2012
The government has not yet confirmed the rates that will apply to installations registered after 1st April 2012 – as soon as rates are confirmed we confirm these on our website
If you have any queries about your eligibility or about the FIT in general, please don’t hesitate to contact us on 0800 1313 161.
Feed in Tariff - Expected Returns
This is in addition to separate payments for the electricity which is exported to the grid and the bill savings made by generating electricity on-site. The Feed In Tariffs has a range of tariff prices for each technology and is guaranteed for up to 25 years tax free (to domestic clients) and index linked offering around a 7% return on your investment annually.
For example, the power from a solar panel could earn up to £900 a year in addition to a £140 saving on the household energy bill.
In return, the low carbon power being generated and sold back to suppliers helps Government meet renewable energy targets.
Those eligible for the Feed In Tariff benefit through:
Generation tariffs - You receive a set rate payment from your energy supplier for each unit (or kWh) of electricity you generate.
Export tariffs - You receive a further payment from your energy supplier for each unused unit of electricity that you export back to the electricity grid.
Energy bill savings - Your electricity bills will be reduced as the electricity you generate is used to power your appliances, rather than having to buy it from an energy supplier.
Eligibility for Feed In Tariff
The following small-scale (up to 5 Mega Watts) low-carbon electricity technologies are eligible for FITs:
- Solar electricity (PV) (roof mounted or stand alone)
- Wind turbine (building mounted or free standing)
- Hydroelectricity
- Anaerobic digestion
- Micro combined heat and power (mCHP) (limited to a pilot at this stage)
The tariffs available and the process for receiving them vary, depending on when the technology was installed, and whether the system and the installer were certificated under the Microgeneration Certification Scheme (MCS) scheme.
Commercial clients are advised to check their tax status for this kind of income as they may be required to pay corporation tax on FIT income.
Feed in Tariff - How to Register
When your system is installed we will register your installation with the scheme and then advise you on approaching a power company such as Good Energy to sell them your electricity.
More Information
Contact us for further information on the Feed In Tariff scheme.
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