The solar industry in the UK owes its existence in no small part to the Feed in Tariff (FIT) first introduced in 2010. Before the FIT the UK solar industry languished for decades finding converts here and there but remaining very much a fringe technology. Today thanks to the Feed in Tariffs the UK is the world’s 6th largest producer of solar power and the solar industry in the UK is worth billions of pounds. Feed in Tariffs are administered by Ofgem the energy regulator and rates are reviewed every 3 months.
Feed in Tariffs are just that; payments made for solar power you generate and feed into the grid. In order to qualify for the scheme you need to have an eligible solar PV system installed on your house (for the record FITs also cover hydro and wind) and register that system with Ofgem. Once that is accomplished there are several ways you’ll be able to save or make money through the FIT scheme.
Exporting energy - Through the FIT scheme your local electric utility will pay you for each unit (kilowatt hour) of electricity you export to the grid. Typically this occurs when businesses or homeowners generate more power than they need or can store. As of this writing the amount you export is estimated (typically half of what you generate is assumed to be sold back to the grid) although future plans call for smart meters to be installed on solar PV systems in order to keep better track of what is actually being generated and exported. Generation - The electric utility will pay you a set rate for each kilowatt of electricity generated by your home or small business system. As of this writing solar feed in tariff levels are guaranteed for the period of the tariff (which can be as much as 20 years). Savings - So you decided to take advantage of the FITs and installed a solar panel array on your home. You’re being reimbursed for the energy you generate and also for excess capacity you send back to the grid but the financial benefits don’t stop there. Because by installing solar panels on your home you’re likely cutting your monthly electric bill by as much as 40%. That’s money you can use for your next holiday or squirrel away for the kid’s education.
Feed in Tariffs are not intended to subsidize large scale solar farms or other types of industrial scale power generation. They apply to small-scale generation of power using means such as solar panels on your home that have been registered and approved by Ofgem. The FIT is available only for the above mentioned renewable energy sources that produce less than 5 megawatts of electricity.
If you’d like to free yourself from dependence on multinational energy conglomerates, make money and help save the environment in the process installing solar panels and taking advantage of the solar Feed in Tariff is something you should strongly consider. Give us a call to find out more, or take a look at our finance solar panels.
