The 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 scheme was introduced on 1st April 2010, and from this date homeowners who have installed solar panels have been paid for all of the electricity they have generated, with an additional payment for any excess electricity they have not used and exported back to the grid.

For an average-sized domestic system the current rate is 16p for every unit of electricity you generate. These payments are guaranteed for 20 years, are tax-free and increase in line with inflation!

The rates have been cut though – is it still worth it?

Most definitely! Although there has been a lot of news in the press recently due to the government’s decision to cut the rate paid for the FIT, the amount solar panel prices have fallen over the last year has meant that the returns are still as good. A solar photovoltaic system can give you a return of up to 10% a year – far better than the return for investing your money in a bank or building society.

Following the installation of a solar photovoltaic system you will benefit from the Feed In Tariff in three ways:

• You are paid for all the electricity you produce. Your electricity supplier will pay you an agreed rate (at the moment it is 16p for domestic systems) for every unit of electricity you produce – whether you use it yourself or not.
• Your electricity bills are reduced. As you are generating your own electricity a lot of the time, you will obviously need less from your supplier, so your bills will fall. This will become an ever greater benefit as fuel prices continue to rise.
• You are paid for any electricity you export back to the grid. Any electricity you produce but do not use is fed back onto the National Grid, and your supplier will pay you an additional 4.5p for every unit you export.

To qualify for the FIT, the installation must be carried out by an MCS-approved installer. Ardenham Energy was the first company in the UK to receive MCS accreditation for the installation of solar photovoltaic panels.

Additionally, from April 2012, every property registering for the FIT must have an EPC rating of level D or better. All of Ardenham Energy’s surveyors are qualified EPC inspectors and will carry out a FREE inspection at the time of your site survey.

The table below shows the Feed In Tariff rates as of 1st August 2012.