Feed In Tariff

Feed-In-Tariffs (FiTs) are payments to you from energy companies enforced by the government to encourage 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. Confused? Want to know more? Call or email us and we would happy to clarify any details. 

For someone fitting a typical 2.5kW photovoltaic solar system to an existing home, a payment of 41.3p per KWh generated will be paid whether that electricity is exported or used by the home owner. A further payment of 3p per kWh will be made for each unit not used and therefore exported to thegrid. New-build properties fitted with solar panels will receive a lowertariff of 36.1p per kWh generated.

These tariff payments are guaranteed for 25 years and they are also indexlinked - i.e. they will rise in line with inflation. A typical 2.5kW system will generate tax-free payments of around £1000 per year and so the payback on the investment will be under 12 years. This also works out as a return on investement of over 8% - far better than any bank savings offers, and particularly attractive to those paying tax at the higher rate.

From April 2011, the Feed-In-Tariff rate will reduce by 7% each year. However, which ever rate you enter FiT on is the rate you stay on for the duration of the 25 year scheme. If want to get locked on the highest rate for 25 years, you need your system installed in the first 12 months of the scheme. 

Below are some example scenarios, based on a retro-fit PV install before April 2010