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New UK Feed-In Tariff
After many months of consultation and waiting the new feed-in tariff scheme officially started on the 1st April.
The rates that were announced in early February were significantly higher than previously proposed and have created a large surge in demand for installations leading to many shortages of equipment, especially inverters which connect the solar photovoltaic systems to the grid.
The FITs payments vary between 41.3p per Kw for retro fit under 4kw, or 36.1p per kw for new build properties, payable for 25 years. These figures are index linked. Any system from 4-10kw will be eligible to claim 36.1p per kw, and from 10-100kw can claim 31.4p per kw. Over 100kw to 50Mw can claim 29.3p per kw.
An alternative is to have an off-grid system, which works in a similar way, but the energy produced is stored in batteries for use when required. This is ideal in rural locations or where there is no direct connection to an electricity suppllier. FITs are also available for these types of systems, but at a lower rate paid per Kw than grid connected systems at 29.3p per kw regardless of its size.
Now these incentives are in place there has never been a better time to earn money to contribute towards the cost of your system.
EXAMPLE
A 2.8KW PV system, installed as retrofit, will give FITs payment to you of £982.94. You will also claim export payment at 3p per watt, giving you an additional saving of £35.17 . This totals £1018.64 per year. If you use some of the energy you produce, this will save you £154.17 per year, bring your ESTIMATED ANNUAL SAVING TO £1173.34. Don't forget the FITs payment is for 25 years, and therefore expected payment over this time is a massive £25,466.00.
For full details of the feed-in tariff follow the link below to the Government Department of Energy & Climate Change.
2011 Update
The Feed in Tariff scheme will have been running for a year at the end of March and as promised in the original legislation, the amount of the payments is indexed linked and therefore will rise in line with the Retail Price Index which increased by 4.8% as of the 1st April 2011.
This increase applies to all existing and new installations which qualify for the feed-in tariff and for most domestic solar PV installations up to 4kWp this will increase the rate from 41.3p per kWh up to 43.3p increasing the annual payment for a typical 3kWp system by about £50 per year.
A 10kWp solar PV system costing approximately £35,000 will now typically earn and/or save around £3,900 per year, index linked for the next 25 years making it a very attractive investment.
Full details of the increased rates can be found in the official Ofgem rates sheet .
This is great news if you already have a registered solar PV system or are considering buying one and makes it an even better investment than ever before.
Since its launch a year ago the feed-in tariff has been a great success and in the latest Ofgem Feed-in Tariff Newsletter they report 17,250 solar photovoltaic installations registered for the scheme in the first nine months of the scheme from April - December 2010 with an estimated 10,000 more expected in the final three months of the first year.