Feed-In Tariffs

This is a government backed scheme which sets out the payments that you are eligible for as a generator of electricity.

The scheme offers guaranteed payments, at rates which vary according to the methods and scale of your generation scheme. Being a government backed scheme, it may at first appear fairly complicated, but for most small domestic and commercial installations the following applies.

The feed in Tariff is a payment which is made to you by your electricity supplier. For most small domestic and commercial installations this is set at the rate of  14.9p per unit. Note that (hopefully) this is a much higher rate than you are currently paying for the electricity you use, and this is the main incentive for people to take part in the scheme. This is viewed as a long term investment by the government - these payments are guaranteed for 20 years, and the rates will increase over time in line with inflation.

Importantly, this tariff is paid for each unit of electricity that you generate, whatever you decide to do with the electricity afterwards. This is important for some people, since it means that you can be paid to generate electricity even if you are not connected to the grid. If, for example, you wish to produce electricity at a remote site which has no mains electricity supply, you will still be eligible for payments under this scheme.

The Feed in tariffs benefit the owner of a solar electric system in three ways.

Firstly, for a typical installation, you will receive a payment of 14.9p per unit of electricity generated, and this is the main benefit of the scheme. It is important to realise that this amount is paid to you for GENERATING the electricity, and it is paid on everything you produce, whatever you choose to do with it afterwards.

Secondly, once you are generating electricity, you may of course use this to power your property. This will happen automatically. When you’re generating power and you turn on the lights, T.V., washing machine, etc, the electricity you generate is used to power these things, instead of taking power from your supplier. If you pay 15p per unit for your electricity, you are saving this amount by using your own, free, electricity.

Thirdly, if you don’t use all of the electricity you’re generating, it is automatically fed back to your electricity supplier. They will pay you 4.6p per unit for any units you supply in this way, on top of the 14.9p you already receive for generating it.

For further information on this scheme, take a look at the websites listed below.

http://www.microgenerationcertification.org/

http://www.ofgem.gov.uk/Sustainability/Environment/fits/Pages/fits.aspx

http://www.energysavingtrust.org.uk/

Follow this link to an article on the subject from the Guardian:

http://www.guardian.co.uk/money/2010/feb/06/solar-power-bright-investment

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