The Feed-in Tariff scheme

1.What is the feed-in tariff and how does it work?

Kilowatt peak refers to the value of power generated by a solar panel system under full solar radiation (under set Standard Test Conditions). Solar radiation of 1,000 watts per square meter is used to define standard conditions. In the UK, one kilowatt peak of solar will generate roughly 850 kilowatt hours (kwh) per year.

2.Why is the Government introducing the Feed-in tariff?

The Government wants to build the market for clean energy. The Feed-in tariff is an incentive for households, businesses, local authorities, farmers and landlords to start generating their own energy, which allows them to protect themselves against future price rises of fossil fuels, cut carbon emissions and receive payment for the low-carbon energy they produce. By doing so, they are investing in a low-carbon economy for the future.

 3.Who pays me for the feed-in tariff?

The energy suppliers pay the feed-in tariffs to those who generate the clean electricity. When you apply for the feed-in tariff, you should ask your energy supplier how and when payments will be made. Payments must be made at least quarterly.

4.Where does the money come from?

The money to pay the producers of green energy comes from a small levy on every UK energy consumer.

5.How long do the feed-in tariffs last?

For solar electric (Photovoltaics - PV) systems the tariff lasts for 25 years. The tariffs are index-linked and guaranteed.
Tariffs will be reviewed every five years - starting in 2013 - and at that stage, the amount new applicants receive and the duration of the tariff may change. It's likely to be at its highest now.

6.Are the FIT rates really guaranteed for the full 25 years? Can future governments back track on them?

The Feed-in tariff is Primary Legislation, and it would be a breach of the Governments contract if it didn't last for 25 years. Payments to individuals will not change over this time - in fact they will increase in line with inflation.

7.Why should I invest now? Will the costs come down?

It's unlikely that the technology costs will become cheaper quickly; and the Feed-in tariff is structured so that you're likely to get the highest benefits now. The feed-in tariff will be reviewed every five years - starting in 2013 - and at that stage, the amount you receive and the duration of the tariff may change.
So now really is the best time to invest.

8.The highest tariffs are for "retrofit systems". How is retrofit different from new build?

The Department for Energy and Climate Change define a retrofit a system as one that is installed on a building that is already occupied. New build systems are those installed on a new building and before it is first occupied.

9.Is the FiT paid from the date the system was installed on the roof or the date the system is commissioned?

The FIT would start from the date of commissioning.

10.What about people in rented accommodation?

We know that lots of Housing Associations and local authorities are interested in using the Feed-in tariff and solar electricity to earn money, save energy and pass some of those benefits on to their tenants. And as for private landlords, it makes sense too: it adds value to their properties, it makes them money and it's good for their tenants.

11.Are the government's financial incentives contingent on carrying out other energy-efficiency work in the home e.g. roof insulation, low-energy lightbulbs etc?

No!

12.Is the same tariff available to businesses investing in solar roofs?

The rates for businesses are the same, but vary according to system sizes. More of an explanation is in our downloadable guide to Solar panel systems.

13.What if I move house?

If you get solar installed and start claiming the 'Feed-in Tariff' you will have lower bills and a steady income from the 'Feed-in Tariff' payments. These benefits can be transfered to the new home owner and so when you come to sell your home you can charge more for it.