What is a feed-in Tariff

Feedin Tariff

How much will I earn?

A well-designed 4kWp system south facing will receive feed-in tariff (generation and export tariff) payments of £550 a year, and save £250 a year on electricity bills. it gets a return on investment between 8.00% and 12.00% and possibly better. That’s before you take predicted energy price rises into account.

How does it work?

Every quarter receive a payment from the energy supplier based on the units of electricity produced by your technology e.g. solar PV. This payment would still apply whether the household used the electricity generated by the technology or not.

Reduce your bills?

Bill reductions are from the new technology generating electricity which will run your appliances and lights during daylight hours etc as oppose to the electricity being consumed from the grid. Additionally, by scheduling appliances to be in operation during daylight hours such as dish washers, washing machine and tumble dryer this will also save on grid use during the evening.

How long does it take?

The duration of payments from the energy company back to the customer will depend on the technology. Solar PV =20 Years, mCHP = 10 Years. Payments are received every quarter.

So what is feed in tariff

The Feed-In Tariff is a Government-backed scheme that offers financial rewards to household generating their own green electricity. The Government introduced the scheme in order to support those who are also trying to reduce the UK’s reliance on fossil fuels and increase our use of renewable energy.

How does it work?

By installing a solar PV system, you’ll benefit by:

Being paid for the electricity you produce

This is called generation tariff which your energy supplier will arrange with you according to the system you have installed for every kWh you generate. (14.38p for systems below 4kWp)

Receiving extra payments for the electricity you do not use

This is the export tariff. You will probably generate more energy than you need, so any remaining electricity will be exported back to the National Grid. Your electrivity provider will buy this back and pay 4.77p for every unit.

Throughout the 20 years of the scheme, your income will increase. Want more information? We’ll be happy to help. Contact us today.

How much will I earn?

For small home systems, the current payment rate is 14.38p for every unit (or kWh) of energy you generate. These payments are guaranteed for 20 years and will increase in-line with inflation. What’s more, they are tax-free.

The financial rewards of this investment are incredibly appealing; in fact you can expect returns of up to 9.5%. Many choose to install solar PV systems instead of investing their money with a bank or building society, who would no doubt be unable to offer similar return rates.

Reducing your energy bills

Electricity generated through your solar panels will feed directly into your house and power your appliances during the day. As energy prices are constantly rising, so will the value of the energy you use.