Use this guide to find out everything you need to know about the Feed-in Tariff.
Feed-in Tariffs (FiTs) have dominated headlines and stirred no end of debate, but what's the fuss all about, what are the actual rates, and how does the scheme work?
What is the Feed-in Tariff scheme?
The Feed-in Tariff scheme - also known as FiTs or the Clean Energy Cashback scheme - means that people who generate their own green or renewable energy will be paid for doing so.
To qualify for the Feed-in Tariff figures quoted below, your house needs an Energy Performance Certificate rating of D or higher.
If you have a lower EPC rating, or your system produces more than 4Kw, you'll be on a slightly different rate - visit the DECC website for more information.
Below is the table of Feed-in Tariffs for households that meet the criteria:
|Feed-in Tariff per kWh||Date systems must be live by|
|15.44p||Before 31st January 2013|
Feed-in Tariffs are already popular across Europe - in the Netherlands, for example, 40% of its electricity is generated through similar schemes. Currently, the UK only gets about 9.4%* of its electricity from renewable sources and the Feed-in Tariff scheme could help to increase this percentage.
How does the Feed-in Tariff work?
You install solar panels or a wind turbine and start generating your own renewable energy.
You use the 'free' electricity you generate in your home, get paid for every unit you generate and buy any extra energy you need from your energy supplier.
You sell any extra electricity you're producing to the National Grid.
The amount you get paid for the electricity you generate will depend on what energy source you're using.
Tariffs are index-linked, which means they will track market prices and, depending on the type of technology you use to generate electricity, they're guaranteed for up to 20 years.
Is it possible to make money from the Feed-in Tariff scheme?
Yes. As well as cutting your electricity bills, you can earn a significant amount of money from the energy you generate. For example:
A 3kW system with 12 solar panels will generate 2575kWhs of electricity per year. A household can use up to 50% of the electricity the panels generate, making a saving of £185.
By signing up to the Feed-in Tariff, you will earn 15.44p for every unit of electricity generated (up to £397), plus £0.045 for every unit sold back to the Grid (£57) meaning total Feed-in tariff earnings of up to £455.
Over the 20 year lifetime of the Feed-in Tariff rate you'll generate an income of up to £12,819*.
What sources of renewable energy generation does the Feed-in Tariff scheme cover?
Solar or photo voltaic power
Hydro Anaerobic digestion - plant and animal material is broken down by bacteria, which produces methane that can then be used to generate energy.
Domestic Micro Combined Heat and Power (CHP) - this produces both heat and electricity from one process, and it's a more efficient way of using both fossil and renewable fuels.
The graphs below from Ofgem shows the total number of installations by technology type between April 2010 and March 2012:
If you've already got a solar panel/wind turbine, can you be part of the scheme?
Yes. The Feed-in Tariff scheme doesn't just apply to new installations. If you've installed a way of harvesting one of the kinds of renewable energy listed above since July 2009, you can join the scheme.
If you started generating your own electricity before July 2009, you can also be part of the scheme but at a lower tariff rate.
What about renewable heat generation - is that covered?
The generation of renewable heat through things like ground source heat pumps, biomass boilers and air source heat pumps is not covered by the Feed-in Tariff scheme.
However, the DECC (Department of Energy and Climate Change) has announced that from April 2011, there will be incentives for renewable heat generation.
I want to switch suppliers, do I have to switch my Feed-in Tariff too?
No. You can continue to receive your Feed-in Tariff payment from your existing energy supplier when you switch energy provider.
More information about Feed-in Tariffs
Microgeneration Certification Scheme (MCS): an independent scheme that certifies microgeneration products and installers. Any solar panels, wind turbines that you want to use for the Feed-In Tariff Scheme will have to be approved by the MCS and installed by a MCS-approved engineer.
For more information about getting involved in the Feed-In Tariff Scheme, you can also speak to your energy supplier.