Feed in Tariff ( FIT ) for Renewable Electricty
The term ‘renewable energy’ means energy generating technologies that do not use up a non-replaceable resources such as coal, gas or oil.
There are many specific technologies, however the most popular are Solar Photo Voltaic, Wind, Micro Hydro Electric, Combined Heat and Power (CHP) to name but a few.
A Feed-In Tariff is a payment from the government for every kWh of electrical energy produced by renewable energy.
In the UK’s case this scheme will come into effect in April 2010 and applies to small home installations up to large commercial installations of upto 5MW in size – which is big enough to include a small windfarm.
This tariff is paid, whether you use the electricity at the place of generation or if you feed surplus energy back into the grid.If you do generate a surplus of energy back to the grid you will also be paid a basic wholesale energy cost of around 4.5p per kWH (current electricity supply price to homeowners is about 10p per kWh)
The rebate will last for 20-25 years and has a maximum value of a whopping 36.5p per kWh
It is important to note that the the feed in tariff is designed to encourage ‘early adoption’ of renewable energy hence the rate paid is reduced year on year.This is to encourage people to take up the offer int he first year of the scheme to maximise the tariff value and keep that tariff maintained for 25 years. In some cases the tariff decreases by as much
For example Client X installs a 2Kw Solar PV system on its roof in 2010, because it does so in the first year of the scheme the feed in tariff or FIT will be 36.5p per kWh for the next 25 years. If Client Y copies Client X but installs the same PV system a year later in the second year of the scheme, the FIT will be reduced by 7% to 33.94 pence per kWh
The table below shows the technologies included and the rate fo FIT for each.
Feed in Tariff for renewable energy – rates of FIT per technology type
| Technology |
Scale |
2010-11 Tariff p/kWh |
Annual change3 |
| AD1 (electricity) |
<5MW |
9.0 |
0 |
| AD1 (CHP1) |
<5MW |
11.5 |
0 |
| Biomass |
<50kW |
9.0 |
0 |
| Biomass |
50kW-5MW |
4.5 |
0 |
| Biomass (CHP1) |
<5MW |
9.0 |
0 |
| Hydro |
<10kW |
17.0 |
0 |
| Hydro |
10–100kW |
12.0 |
0 |
| Hydro |
100kW–1MW |
8.5 |
0 |
| Hydro |
1-5MW |
4.5 |
0 |
| Micro-CHP1 |
<50KW |
TBA |
|
| PV1 (New build2) |
<4kW |
31.0 |
- 7 % |
| PV1 (Retrofit2) |
<4kW |
36.5 |
- 7 % |
| PV1 |
4-10kW |
31.0 |
- 7 % |
| PV1 |
10–100kW |
28.0 |
- 7 % |
| PV1 |
100kW–5MW |
26.0 |
- 7 % |
| PV1 (stand alone2) |
<5MW |
26.0 |
- 7 % |
| Wind |
<1.5kW |
30.5 |
- 4 % |
| Wind |
1.5–15kW |
23.0 |
- 3 % |
| Wind |
15–50kW |
20.5 |
- 3 % |
| Wind |
50–250kW |
18.0 |
0 |
| Wind |
250–500kW |
16.0 |
0 |
| Wind |
500kW–5MW |
4.5 |
0 |
| Existing RO1 sites |
<50kW |
9.0 |
0 |
| 1 Abbreviations: AD=Anaerobic Digestion, PV=Photovoltaic (solar), CHP=Combined heat and power, RO=Renewables Obligation | |||
| 2 The govt consultation document doesn’t define these | |||
| 3 The annual degression or reduction in tariff – this determines the tariff value in the following years of the scheme. | |||
To find out how best to capitalise on the FIT in your residential or commercial property sign up for a Energy Efficiency Opportunity Survey which includes a full analysis of the technologies which may benefit your specific circumstances.
Call William Martin Energy today to arrange an appointement on 0207 378 5800 or email us.
