Feed-in tariffs are payments
made to homeowners and businesses for the
renewable electricity they generate.
The feed-in tariff, introduced on 1st April
2010, guarantees that owners of small scale
solar PV systems will receive up to 21.0p
for every kWh of energy generated for the
next 25 years. If you read on you will get
the fine print. If you haven't got time
this may be all you need to know:
You can receive a payment (tariff) from
your electricity company of up to 21.0p
per kWh of energy generated, whether you
use it in your house or not. You can also
use the energy for free.
The tariff is non-taxable and will increase
in line with inflation (RPI).
It applies for 25 years from the date of
system installation. So for 25 years you
will get paid for the electricity you generate.
Overall you can expect around a 6-11% return
on your investment. That means that if you
invested £11000 in solar panels you'd
be approximately £1200 better off
per year. If you have money in the bank,
you'll be lucky to get 1% on it at the moment.
"A return of 9% - better than any
bank can provide" - Ed Miliband, speaking
in his former role as Secretary of State
for Energy and Climate Change
Feed in Tariff’s (FiT’s)
– sometimes called the “clean
energy cash back scheme or solar grants”
Launched in April 2010, the
introduction of the UK’s Solar Feed
in Tariffs has heralded what can only be described
in the largest surge in demand the UK solar
industry has seen in its long history.
The reason is clear; without
FiT’s the average pay back time for
a PV system was well over 35 years but with
the FiT’s payback reduces to as little
as 8 years and thereafter during the remainder
of the 25 year period the FiT’s are
guaranteed for, the system will earn BIG profits!
How does the
Government FiT’s work?
As part of the Solar PV System
we supply an energy monitor that accurately
counts every unit (KwH) of energy produced
by your solar system. Your energy supplier
(who is responsible for paying you for the
FiT’s), will make a payment to you,
usually every quarter, for the total number
of units your system has produced.
Once the electricity produced
by your solar system has passed through the
energy monitor it then goes into the grid.
You then have the additional
benefit of all the electricity produced! This
will be delivered to you in the following
ways:
1. If the property
is consuming electricity, what is produced
by your solar system will be used instead
of you having to buy electricity, thereby
reducing or even removing your electricity
bill.
2. If the electricity
demand from the property is low (e.g. during
a period when the occupants are on holiday),
the energy produced will be almost entirely
sold back (exported) to your energy provided.
They will pay you £3.1p per unit for
this.
Because very few properties
have smart meters installed it is impossible
to measure where the energy produced by a
solar system actually goes, so all of the
UK’s energy companies have agreed that
50% of the produced energy will be assumed
to have been used by the property and that
they will pay you for remaining 50%.
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