Feed-in Tariffs (FITs) became available in Great Britain from of 1st April 2010. Under this scheme energy suppliers make regular payments to householders and communities who generate their own electricity from renewable or low carbon sources such as solar electricity (PV) panels or wind turbines.
The scheme guarantees a minimum payment for all electricity generated by the system, as well as a separate payment for the electricity exported to grid. These payments are in addition to the bill savings made by using the electricity generated on-site.
At a generous 41.3 pence per kWh paid for all electricity you generate you can expect to receive around £1000 per year, based on the fitting of an average system.
Furthermore about half the electricity you currently consume and pay for will now be self generated and free whilst any electricity that is self generated and unused will be exported back to the grid for a guaranteed minimum payment of 3 pence per kWh, (you can negotiate a higher rate with your energy supplier if you wish). Therefore taking into account what is paid to you and saved by you, you can expect to make an operating profit from your energy bill every year.
In order to incentivise people to adopt renewable energy, the current feed in tariff will be paid for at least 25 years, TAX FREE and INDEX LINKED ……. that equates to a return of 15.6% for a 40% taxpayer and 18.2% for a 50% taxpayer, based on the current Retail Price Index.
The Government’s Feed-in Tariff scheme has been created to encourage early take up of PV solar technology. Based on a similar, highly successful scheme in Germany, the current scheme is only open to new entrants until 2012..
After that, new feed-in prices will be reduced as take up increases, eventually stopping altogether at some point in the future. This will not affect those with a system installed between 01/04/2010 and 31/03/2012. They will continue to be paid the highest rate for the next 25 years.
It is therefore advisable to buy and install your PV solar energy system as quickly as possible, especially as demand is set to soar as we approach the 2012 deadline.