What are Feed-in Tariffs?
You could be paid both for electricity you generate and surplus electricity that is exported back to the National Grid.
- Reduce your electricity bills
Generating your own clean, sustainable electricity to run your lighting and home appliances means you are likely to buy less electricity from your supplier, so your electricity usage may reduce.
- Earn money for exporting electricity
Where export is permitted to be deemed, the Secretary of State determines the percentage of Electricity deemed to be exported. Such a determination is published at least one month before the beginning of each FIT year.
- Both generation and export tariff rates are index-linked which means that they increase and decrease with inflation. The tariff rates are adjusted annually by the percentage increase or decrease in the Retail Price Index over the 12 month period ending on 31st December of the previous year.
The energy regulator, Ofgem, administers the Feed-in Tariffs scheme but your electricity supplier makes FITs payments. There are three ways you can benefit from Feed-in Tariffs:
Reduce your electricity bills – generating your own clean, sustainable electricity to run your lighting and home appliances means you are likely to buy less electricity from your supplier, so your electricity bills may be lower.
This rate depends on when you register for FITs but it is guaranteed for the period of the tariff (as defined in your FIT plan letter) and will increase or decrease with inflation, in line with the Retail Prices Index.
Earn money for exporting electricity – surplus electricity that you generate but don’t use can be exported back to the national grid. Subject to eligibility you would earn 4.77p/ kWh for electricity that you sell back to your supplier.
A full list of Feed-in Tariffs is available from the Ofgem website.
An example of how Feed-in Tariffs work
- 1 Electricity is generated by solar panels. Your electricity supplier pays you for each unit of electricity you generate. You can use the electricity you generate meaning you don’t have to import from the grid.
- 2 You export electricity back to the grid when you don’t use it. Where export is permitted to be deemed, the Secretary of State determines the percentage of Electricity deemed to be exported.
- 3 You only import electricity from the Grid when you require additional power.
What you could get with Feed-in Tariffs
The money you can earn through Feed-in Tariffs varies according to the technology you install. For a full list of Feed-in Tariffs please visit the Ofgem website. A 4KWp Solar PV System registered before 1st April 2014 could generate an income of £874 a year in Feed-in Tariff payments and a saving of £251 on your annual electricity bill.
|Solar PV system size
|Electricity Bill Savings
The above figures are explained as follows:
Solar PV system
In accordance with MCS guide lines, please note that the performance of solar PV systems is impossible to predict with certainty due to the variability in the amount of solar radiation (sunlight) from location to location and from year to year. This estimate is based upon the standard MCS procedure is given as guidance only. It should not be considered as a guarantee of performance.
The calculation is based on MCS guidelines and is valid for a 4kWp system on a south facing, 30 degree roof with no shading in WR4 post code area that has been installed after 1st April 2014 and export income assumes 50% of generation exported onto the grid at DECC's current export tariff of 4.77p per kWh. Actual performance may be significantly lower or higher if the characteristics of the installed system vary from the estimated values.
Figure assumes annual generation of 3,716kWh and based on DECC's current Feed-in Tariff (as at 1st April 2014) generation rate of 14.38pp/kW for customers with a solar PV system under 4kWp or less in size- as per www.ofgem.gov.uk/fits.
Figure assumes 50% of amount generated being exported back on to the grid and based on DECC’s current export tariff (as at 1st April 2014) of 4.77p.
Electricity Bill Savings
Figure based on year zero costs with no degradation or inflation applied, and calculated using the Energy Saving Trust’s April 2014 estimated average electricity price of 13.52pper kWh and generation of 3,716kWh per year. Assumes 50% of all electricity generated will be used in the home. These savings are for customers installing after 15 July 2009. All existing customers registered for the Renewables Obligation before this date will be subject to different Feed-in Tariff rates.
What you could get with FITs:
The figures above are provided for illustrative purposes only and does not constitute financial advice. No two installations of the same type and scale are likely to produce the exact same level of generation each year for the same cost, and thus generation and export figures can vary between installations. Actual electricity bill savings are dependent upon occupancy patterns and individual behaviour and circumstances. Does not include any installation costs, maintenance costs or tax implications.
Tax free generation
Tax free generation: Generation and export income is tax free provided that the income is not received in a business capacity (e.g. the individual must not be running a business from their house) and that the individual is not providing a form of service or facility in connection with the electricity being generated. However, the income is subject to VAT if the generator is VAT registered. See solar panels for more information.
Whilst npower has made all reasonable efforts to ensure that all information on its website is accurate at the time of inclusion, please note our Legal Disclaimer.
Registering for the Feed-in Tariff
You can request a FIT application form by contacting us:
0800 048 0520 (Free from most landlines).
0330 100 7567 (Included in any 'inclusive minutes' from mobile).
What to include with your application form
To fully pre-register you on our system, we require:
- Fully completed application form (with section 11 signed and dated)
- Have you opted in to receive export payments?
- Microgeneration Certificate Scheme (MCS) certificate or ROO-FiT Certificate (if over 50kW)
- Energy efficiency declarations numbered 1 to 6 (PV Only)
- Fully paid invoice on installer headed paper with company logo and VAT registration
- An Energy Performance Certificate Level D or above or an official exemption letter (PV installations only)
- A valid generation meter read (this must be taken on the day we receive your application form in our offices)
- Proof of identity and address (such as a copy of your driver’s license/passport and a utility bill)
- VAT Company details (if you are a non domestic customer)
What is a valid meter read?
As of 1st July 2013 we must have a meter read from the day your application is received in our offices. You will be contacted on that day for a meter read.
Your eligibility date
Your eligibility date is when we receive your fully completed application (including all supporting information). If the application form is incomplete, we will return it to you and ask you to re-apply. If you have any queries about the above please refer to www.ofgem.gov.uk/FITS
If you have any further enquiries you can find answers to frequently asked questions. Alternatively, please call us on 0800 048 0520 or from a mobile 0330 100 7567.