Feed-In Tariffs Explained

In response to its legal target to reduce UK carbon emissions by 80% by 2050, the UK Government has put together an incentive package to stimulate market growth in the small scale renewable energy production.

The system - already successful in Germany, the world leaders in solar photovoltaic technology -rewards you financially for all the power you produce using an eligible micro-generation system - whether for your own use or exported to the national grid.

The savings are dependent on the size and generation potential of the solar photovoltaic or wind turbine installation.

As you may have already heard in the news Feed-In Tariffs are subject to reviews and these reviews manage the level of payment a system will receive.

 

 

Background

In April 2010, the UK Government rolled out a system of Feed-In Tariffs (FITs) - also known together as the Clean Energy Cashback scheme - to encourage small scale, low carbon electricity generation. The Government's aim was to "trigger a small scale electricity revolution".

Tariffs

The Feed-In Tariffs consist of three elements of payments made to generators of renewable energy and paid for by electricity suppliers. The tariffs are set, determined by system size and generating potential and are index-linked to inflation.

1. The Generation Tariff: paid for every kilowatt hour (kWh) of electricity that is generated and recorded via a generation meter. The Generation Tariff is paid regardless of whether the electricity is used onsite or exported to the national grid.
2. The Export Tariff is paid for any excess electricity that is exported back to the grid.
3. Savings on electricity.

The scale of Feed-In Tariffs varies according to the style and size of the renewable energy generating system: the Feed-In Tariffs which apply to photovoltaic panels and wind turbines are different.

SOLAR - PHOTOVOLTAIC PANELS

System Size	FIT income rate/ per Kilowatt hour

	Export Tariff	Generation Tariff
0 - 4 kWp	3.1p	21.1p
0 - 4 kWp (new build)	3.1p	21.1p
4kWp - 10 kWp	3.1p	16.8p
10 kWp - 50 kWp	3.1p	15.2p
50 kWp - 150 kWp	3.1p	12.9p
150 kWp - 250 kWp		12.9p
250 kWp - 5000 kWp	3.1p	8.5p

 

WIND

System Size	FIT income rate/ per Kilowatt hour

	Export Tariff	Generation Tariff
0 - 15 kW	3p	28.0p
15 - 100 kW	3p	25.3p
100 - 500 kW	3p	19.7p
500 - 1500 kW	3p	9.9p

 

PHOTOVOLTAIC PANELS

 

How does the Feed-In Tariff system work?

 

 

How much can I save? - Yearly return on investment

 

Example : Average House

(3 bedrooms) consuming 3,300kWh/yr ( approx. 16p* per Kwh)

For the return on investment potential of other sizes of solar PV systems, click here>>

4kW (3126 kWh/yr)	Property with no PV System	Property with PV system
Import Costs (Yearly power consumption multiplied by conventional energy supplier current rate)	3,300 x 16p*/kWh = £528/yr	1,737 x 16p*/kWh = £278/yr
Generation Tariff (Government-set rate per unit for renewable electricity generated, paid by your energy supplier multiplied by the maximum power output of your system)	n/a	3,126 x 21.1p/kWh = £660/yr
Export Tariff (The conventional energy supplier presumes that 50% of renewable energy produced is exported to them for re-distribution – this assumption is due to a lack of an intelligent metering system at present.)	n/a	1,563 x 3.1p/kWh = £49/yr
Avoided Costs / Bill Savings (The conventional energy supplier presumes that 50% of renewable energy produced is exported to them for re-distribution – this assumption is due to a lack of an intelligent metering system at present.)	n/a	1,563 x 16p*/kWh = £250/yr
TOTALS	-£528/yr	£959/yr (-£278)

*Average Rate @ Dec 2011 (sample EDF energy)

Case study

Read how Mr L. from Ipswich and Mrs H from Suffolk benefitted from their solar PV installations >>

 

WIND TURBINE

 

How does the Feed-In Tariff system work?

 

 

 

How much can I save? Yearly return on investment

 

Example : Small Commercial / Large Residential Property

(4+ bedrooms consuming 10,000+ kWh/yr (@approx.16p* per kWh ))

For the return on investment potential of other sizes of wind turbine systems, click here >>

11kW (25000 kWh/yr)	Property with no wind system	Property with wind system
Import Costs (Yearly power consumption multiplied by conventional energy supplier current rate)	10,000 x 16p*/kWh = £1,600/yr	5000 x 16p*/kWh = £800/yr
Generation Tariff (Government-set rate per unit for renewable electricity generated, paid by your energy supplier multiplied by the maximum power output of your system)	n/a	25,000 x 28p/kWh = £7,000/yr
Export Tariff (The conventional energy supplier presumes that 50% of renewable energy produced is exported to them for re-distribution – this assumption is due lack of an intelligent metering system at present.)	n/a	12,500 x 3.1p/kWh = £387/yr
Bill Savings (The conventional energy supplier presumes that 50% of renewable energy produced is exported to them for re-distribution – this assumption is due lack of an intelligent metering system at present.)	n/a	5000 x 16p*/kWh = £800/yr
TOTALS	-£2,800/yr	£8,187/yr (-£800)

*Average Rate @ Dec 2011 (sample EDF energy)

 

Case study

Read how Mr A. from Stowmarket, Suffolk benefitted from his wind turbine installation. >>

More questions about the Feed-In Tariffs system?

Do take a look at our frequently asked questions for FITs >>. During our free site survey we are happy to answer any particular queries you may have and share our experience with you; you are also very welcome to contact us for further information.

If you would like to find out more from the Department of Energy and Climate Change response to the Summer 2009 Consultation and other documents or useful websites concerning FIT matters, click here>>

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