What is a feed-in tariff?

A feed-in tariff system is designed as an incentive for energy producers to move away from conventional fossil fuels to renewable energy sources. it is government legislation which guarantees a fixed, premium rate for renewable electricity fed into the national grid. The power companies are obliged by the government legislation to buy the renewable electricity, the additional costs of which are passed onto the customers.

The feed-in tariff proposed by the government will go live in April 2010. All installations must be carried out by an MCS-approved installer, using MCS-approved products to qualify for the feed-in tariff. All accredited installations from July 2009 onwards will be eligble.

The tarrif is guaranteed for the next 25 years, although the rate given in the first year will fall by 7% for new installations in each successive year. The rate given in the first year of install will continue for the lifetime of the tariff.

.

How can Ardenham Energy help ?

As a Microgeneration Certification Scheme (MCS) approved installer, you can be sure of qualifying to receive the full benefits of the feed-in tarrif by having your solar PV or wind turbine system installed by Ardenham Energy.

We have developed an Excel spreadsheet to show the likely returns for solar PV installations under the feed-in tarrif. This can be downloaded from our Downloads page.

Domestic Solar Installation - a worked example with Feed-In Tarrif.

With a Government Low Carbon Buildings Programme Grant, a 3 kWp Solar PV array for a  domestic south facing property will cost in the order of £12,500 plus 5% VAT making a total of £13,125. There is a £2500 grant eligible which will make the net cost £10,625.

(Systems installed from now until April 2010 will qualify for both LCBP government grants and the new Feed-In Tarrif.)

On 16th July the government announced a consultation that proposed that every kWh (unit) generated, the owner will be paid 36.5 pence, and every exported kWh  will be paid 5 pence. Each year thereafter the price paid for generated energy wil decrease by 7% for new applications. The price paid for applications in that year will be constant for 25 years.

A 3.06 kWp system will comprise 18 solar panels of 170Wp each, inverters, framing, cabling and switchgear, which is connected to the grid, and surplus electricity is exported and metered. Typically a 3kwp array will export 50% of the energy in any one year.

The sums:

What should I do next ?

• Check our price pages to see the costs and likely returns for the size of system you are interested in by clicking on the relevant link below.

• Download a copy of our Feed-In-Tariff Returns Calculator and Site Survey Form from the downloads page.

• Call Ardenham Energy if you have any further questions or would like to arrange a site survey.

Notes:

 It is not clear whether these payments will be exempt from tax.

It is not clear whether the generation payments will be index linked. The 5p/kWh will be market based and should increase yearly

The equipment and installation must be undertaken by a certified manufacturer/installer

The proposal is subject to 3 months consultation and may alter from current proposal

Low Carbon Buildings Programme www.lowcarbonbuildings.org.uk/

For more information please contact Ardenham Energy.