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Feed-in energy tariffs

Feed-in energy tariffs

The Feed-in Tariff scheme (FiT) closed to new applicants (with a few exceptions) on 1 April 2019.

If you installed an eligible system with a Microgeneration Certification Scheme certificate on or before 31 March 2019, you have until 31 March 2020 to apply for the FiT scheme.

Peter Earl
From the Energy team
4
minute read
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Posted 05 FEBRUARY 2020

What is the Feed-in energy tariff?

The Feed-in Tariff (FiT) is a Government scheme that pays homeowners and businesses to generate and export to the grid their own electricity, from renewable or low-carbon sources. 
 
It was first introduced in 2010 to encourage the use of renewable energy and reduce the UK’s dependence on fossil fuels. The FiT closed to new applicants in April 2019. This doesn’t affect you if you are already on a FiT. 
 
Technologies eligible for the scheme include Microgeneration Certification Scheme (MCS) certified: 

  • solar panels 
  • wind turbines 
  • Micro-CHP (micro-combined heat and power) 

And ROO-FIT (Renewals Obligation Order Feed-In Tariff) accredited: 

  • hydroelectric systems  
  • anaerobic digesters (these break down organic matter like food or animal waste, to create bio-fertilizer and bio-gas).  

What are the benefits of the Feed-in Tariff Scheme?

There are three main perks of the FiT Scheme: 

  • Get paid for selling back to your energy supplier any energy you produce and don’t use. 
  • Make savings on your energy bills for the energy you do use. 
  • Sense of pride for doing your bit for a cleaner environment, by helping to reduce your carbon footprint.  

How does the Feed-in Tariff Scheme work?

If you installed an eligible system with an MCS certificate on or before 31 March 2019, you have until 31 March 2020 to apply for FiT payments. You do this through an energy supplier that’s a FiT licensee. This doesn’t have to be the same supplier that you get your energy from.  
 
There’s a cap on the amount of applications that can be accepted, so even if you’re eligible, you might not be accepted if the quota has already been filled. 
 
Larger energy suppliers are required by law to take part in the scheme, although lots of smaller suppliers signed up, too.  

Payments are usually quarterly and are based on the meter readings you submit to your energy supplier. If accepted, you could receive payments for up to 20 years – 25 years if you joined the scheme before August 2012. 
 
If you have a smart meter, your readings will be automatically sent to your energy supplier. If you don’t have a smart meter, you’ll need to have three different electricity meters to measure the three types of energy flow: generation, import (you’ll already have this one to pay your energy bills), and export.

What are the feed-in tariff rates?

The FiT scheme has two types of payment: 
 
Generation tariff 
You’ll be paid by your energy supplier for each kWh hour of electricity you produce. The rate depends on the installation date, the size and type of technology, and the overall energy efficiency of your home. Where you live is also a factor.

There are three rates for solar panels: high, middle and low. Homes with a valid Energy Performance Certificate (EPC), and an energy rating of A to D, are eligible for the highest payment rate. 
 
The table below shows the higher rates for new installations with a total capacity of 10 kW or less in March 2019, when the scheme closed. 

Standard solar PV**  3.79 
Wind turbine  8.24 
Hydro power  8.03 
Combined heat and power  14.52 

**PV stands for Solar Photovoltaics - solar panel electricity systems. 

Export tariff 
This is a bonus payment for any extra electricity you generate and sell back to the National Grid. The current tariff has a set price of 5.24 pence p/kWh.

Why has the Feed-in Tariff Scheme ended?

The FiT scheme has been extremely successful, with nearly 850,000 businesses and households having signed up by the end of March 2019. However, the falling costs of installing solar power, and the Government’s desire to reallocate funds to larger projects, have led to the closure of the scheme.

What has replaced the Feed-in Tariff?

The Smart Export Guarantee (SEG) came into force on 1 January 2020. Like the FiT, this scheme provides payments for generating electricity from renewables. However, it works slightly differently, with payments set by licensees rather than Ofgem, which sets FiT payments.

Is it still worth getting renewables?

Absolutely. If you didn’t make the 31 March 2019 deadline, you can investigate the Smart Export Guarantee scheme. Also, you can still save money on your energy bills with renewable tech like solar power and wind turbines. And don’t forget the huge reduction in your carbon footprint.  
 
And whether you have renewables or not, lots of renewable energy suppliers offer green tariffs.  
 
Compare standard and renewable energy prices with us today and find the right tariff to suit your needs.

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