Frequently asked questions
Feed-in tariffs are new measures introduced by the Government to support the uptake of microgeneration technologies in the UK. To help you understand what FITs are and how you could benefit from their introduction we have put together a set of frequently asked questions that explain everything.
Feed-in Tariffs (FITs) are financial support measures introduced by the government to increase the uptake of small-scale renewable generation (<5MWe) and help deliver the UK’s 2020 renewable energy targets. The mechanism provides renewable generators with a 20 year (or 25 years for Solar PV) guaranteed per unit support payments (p/kWh) for electricity generation.
The feed-in tariff provides three key benefits for anyone installing microgeneration. These benefits include
- Guaranteed premium payment for all electricity produced.
- Guaranteed price for any electricity exported onto the electricity network. This will be deemed based on the amount electricity generated.
- Onsite usage of generated electricity, therefore reducing the amount purchased from an electricity supplier.
The feed-in tariff is available from 01/04/10. The table below provides details of the tariff levels that you can expect to receive.
| Technology | Size | Tariff (p/kWh generated) |
|---|---|---|
| Solar photovoltaic (PV) | <4kW (new build) | 36.1 |
| Solar photovoltaic (PV) | <4kW (retrofit) | 41.3 |
| Solar photovoltaic (PV) | 4-10kW | 36.1 |
| Technology | Size | Tariff (p/kWh generated) |
|---|---|---|
| Wind | <1.5kW | 34.5 |
| Wind | 1.5-15kW | 26.7 |
The tariff levels set out above apply to systems installed before April 2011. Systems installed after this will be subject to new lower tariff rates: The government proposes that the model incorporates annual ‘degression’ whereby the tariff level will reduce by a fixed percentage for systems installed in the future. Generators will continue to receive the same tariff rate for the 20 year period (25 years for Solar PV) as they did upon installation.
The amount of money you save will be dependent on the amount of electricity that you generate and how you use this electricity in the home. The feed-In tariff is a 'premium tariff' which means that generators will be paid the FIT rate (p/kWh) for their total generation but will also be able to 'sell' any electricity they export back to the grid. Customers will recieve a guaranteed export payment of 3p/kWh. This is designed to encourage generators to use the electricity they generate within their home so they can benefit further from reducing the need to purchase electricity from a supplier. The below table provides examples of the savings that you could make by installing solar PV panels:
| Installed system size | 1 kWp | 2 kWp | 3 kWp | 4 kWp |
|---|---|---|---|---|
| Installed price (inc VAT) | £7,680 | £11,454 | £15,830 | £19,399 |
| Annual Generation (kWh/a) | 892 | 1,734 | 2,601 | 3,366 |
| Electricity exported ( kWh ) | 446 | 867 | 1,300 | 1,683 |
| Feed-in tariff scenario | ||||
|---|---|---|---|---|
| Import Price p/kWh1 | 12.96 | 12.96 | 12.96 | 12.96 |
| FIT (p/kWh) | 41.30 | 41.30 | 41.30 | 41.30 |
| Export price | 3.00 | 3.00 | 3.00 | 3.00 |
1 npower standard domestic tariff price for Midlands distribution area as of 31st March 2009.
Prices provided are 'follow-on unit rates'.
| Feed-in tariff Scenario | ||||
|---|---|---|---|---|
| Import Savings | £57.80 | £112.36 | £168.48 | £218.11 |
| FIT income | £368.40 | £716.14 | £1074.21 | £1390.16 |
| Export income | £13.38 | £26.01 | £39.00 | £50.49 |
| TOTAL | £439.58 | £854.51 | £1281.69 | £1658.76 |
Please note that savings provided above are for customers installing after 15 July 2009. All existing customers registered for the Renewables Obligation before this date will be subject to different FIT rates.
Feed-in tariffs are open to all renewable generators <5MWe. Different tariff rates apply depending on type of technology and whether the system has already been registered for government support:
- Systems installed between 15.07.09 and 01.04.10 will be eligible to receive FITs. All customers installing during this period must be registered under Renewable Obligation. As a registered generator customers will be able to receive Renewable Obligation Certificates (ROC) payments for any electricity generated during his period. Come 1st April 2010 customers registered during the interim period will be automatically transferred over to the feed-in tariff and the FIT applied for generation from this point forward. Please note that customers registered for ROCs during the interim period will receive a 6 month reduction in the lifetime support of the FITs.
- Systems installed after April 2010 Customer’s installations will be registered by an accredited body in order to qualify for feed-in tariffs. Customers must then approach their supplier to begin receiving FIT payments as per the table above.
- Systems installed before 15.07.09 Systems installed and registered for ROCs before 15.07.09 (date of consultation launch) will still be able to receive FITs however they will receive a lower FIT rate at 9p/kWh, regardless of technology.
Feed-in tariffs are open to all house holders regardless of whether they have received a grant or not. The only consideration is whether or not you are already registered for ROCs. If this is the case, you will receive a different tariff rate as explained above.
All information provided above has been summarised using information contained within the 'Governments response to the Summer 2009 consulation', Decc, Feb 2010. For further information about 'Renewable Electricity Financial Incentives' please visit the government's Department of Energy & Climate Change website.
