Feed-In Tariffs

Feed-In Tariffs were introduce in April 2010 as a means of encouraging electricity generation from renewable technologies. The system is designed to provide funding for domestic scale projects but covers commercial projects too, it works by paying you money for the electricity that you generate. By fitting a renewable energy generating system to your home your office, you can benefit in three ways:

  • Generation Tariff: This is the payment you receive for generating each kWh of energy regardless of whether you use it on site or export it to the National Grid. Once you have your system registered the payments are guaranteed at the rate you signed up at for 20 years – you don’t have to worry about any future cuts.
  • Export Tariff: OFGEM make the assumption that half of the energy that you generate will be exported to the grid (i.e. you won’t use it on site) SO for half of the units that your renewable technology generates, you’ll be paid a further 4.64p/kWh!
  • Savings on your energy bill: By generating electricity yourself, you won’t need to buy as much energy from your supplier meaning that you can save a substantial amount of money on your utility bills, especially during summer

Tariff rates vary depending on the technology that they’re applied to; but they cover Solar PV systems, Micro Wind Turbines, Micro Hydro-Power systems and some Combined Heat and Power (CHP) systems. They also increase in line with the Consumer Retail Price Index (RPI), meaning the value of the money you receive will always stay the same.

There are specific rules that apply to each technology. For Solar PV installations, the home needs to score an energy efficiency rating of ‘D’ or above on the Domestic Energy Performance Certificate. If it’s lower than this the installation will still receive the FIT, but at a reduced rate. A domestic EPC is not required for other electricity generating technologies such as Wind and Hydro.