Feed-in Tariff scheme

Changes to the Feed-In Tariffs Scheme

The UK Government's Department of Energy and Climate Change (DECC) recently held a consultation on a review of the Feed-In Tariffs scheme (FITs). On 17 December 2015 they published their response which included new, reduced tariffs for domestic-scale solar PV systems which will come into force from 15 January 2016 for new installations.  Those already receiving FITs are unaffected by the changes.

FITs tariffs already published by Ofgem under the existing FITs scheme rules will apply from 1 January 2016 to 14 January 2016.

From 15 January 2016 the new, reduced tariffs will apply. There will be a pause in the FIT scheme from 15 January to 7 February (inclusive), during which time no new installations will be FIT accredited. Any installations made in this period will be placed in a queue until the new tariffs come into force on 8 February. 

A number of additional changes are being made to the FITs scheme and further information will shortly be made available here.  

Until then you can refer to the full details of the proposed changes and consultation documents on DECC’s website which are also summarised in the changes to renewables subsidies press release 

Draft guidance from Ofgem has also been published

You should bear these changes in mind if you are considering investing in a renewable electricity system or are making other decisions based on the Feed-In Tariffs scheme.

Last updated 17 December 2015.

 

The following information relates to the current FIT system, which will remain in place until January 14th: 

 

About Feed-in Tariffs

Feed-in Tariffs were introduced on 1 April 2010 and replaced UK government grants as the main financial incentive to encourage uptake of renewable electricity-generating technologies. Most domestic technologies qualify for the scheme, including:

The UK Government's Department for Energy and Climate Change (DECC) makes the key decisions on FITs in terms of government policy. The energy regulator Ofgem administers the scheme.

Your energy supplier will make the FITs payments to you. The large energy suppliers are required by law to provide them; smaller suppliers are not, but many have opted to offer them anyway. Visit Ofgem for a list of FITs-licensed suppliers.

For you to qualify for FITs, the installer and the products you use must both be certified under the Microgeneration Certification Scheme (MCS), except hydro and anaerobic digestion which have to go through the ROO-FIT process. The tariffs you receive depend on both the eligibility date and, for solar PV, your property’s Energy Performance Certificate (EPC) rating. 

Eligibility dates

The eligibility date is the date from which an installation becomes eligible for FITs payments. For most renewable electricity systems (with a declared net capacity of 50kW or less), this will be the date your FIT supplier receives a valid application for FITs. This will be after the date on which your renewable electricity system is installed, so it's essential to send your application to your FIT supplier promptly – for absolute certainty, use Royal Mail's Special Delivery.

We recommend that you contact your FIT supplier (also known as the FIT licensee) as soon as possible to confirm the requirements below and make sure you know exactly what information they require from you and when they need to receive it by. Please note that you will only be paid for what you generate based on the meter reading on the eligibility date. This is likely to be a later date than when the system was commissioned so units generated before the eligibility date may not be paid. You should check this with your FIT licensee before system is commissioned.

 When to add solar panels

The rules are slightly different for an extension. If you add solar panels to an existing system, the eligibility date for the new panels is always the date they were commissioned, not the date that you send your revised claim in. This is particularly important if you want to claim the higher rate by submitting an EPC. The EPC must be dated before the commissioning date or you will not get the higher rate.

If you are eligible to receive FITs you will benefit in three ways:

  • Generation tariff: your energy supplier will pay you a set rate for each unit (or kWh) of electricity you generate. Once your system has been registered, the tariff levels are guaranteed for the period of the tariff (up to 20 years) and are index-linked.
  • Export tariff: your energy supplier will pay you a further rate for each unit you export back to the electricity grid, so you can sell any electricity you generate but don't use yourself. At some stage smart meters will be installed to measure what you export, but until then it is estimated as being 50 per cent of the electricity you generate (only systems above 30kWp need to have an export meter fitted, and a domestic system is unlikely to be that big).
  • Energy bill savings: you will be making savings on your electricity bills because generating electricity to power your appliances means you don’t have to buy as much electricity from your energy supplier. The amount you save will vary depending how much of the electricity you use on site.

Tariffs

Once you are receiving FIT payments, the rate you get will increase in line with inflation in accordance with the Retail Price Index (RPI). The tables below summarise the latest tariffs available for each technology. For the full list of tariff rates visit Ofgem's website

Summary of Solar PV tariffs

Solar PV

System size

Generation tariff

Export tariff

Eligibility date

1 Oct 2015 to 31 Dec2015

Eligibility date

1 Jan 2016 to 14 Jan 2016

Eligibility date

1 Apr 2015 to 31 Mar 2016

Higher rate

(EPC band D or above)

Lower rate

(EPC not band D or above)

Higher rate

(EPC band D or above)

Lower rate

(EPC not band D or above)

4kW or under

12.47 p/kWh

5.94 p/kWh

12.03 p/kWh

5.73 p/kWh

4.85 p/kWh

> 4kW – 10kW

11.30 p/kWh

5.94 p/kWh

10.90 p/kWh

5.73 p/kWh

4.85 p/kWh

> 10kW – 50kW

11.30 p/kWh

5.94 p/kWh

10.90 p/kWh

5.73 p/kWh

4.85 p/kWh

Stand-alone

4.28 p/kWh

4.28 p/kWh

4.85 p/kWh

 
  • Evidence of property’s EPC rating will be required when applying for FITs. If no evidence showing the EPC has a band D or higher then the lower rate will apply.
  • The tariff period (lifetime) is now 20 years.
  • The tariffs are to be reviewed every three months and will be revised according to deployment rates.

For site-specific calculation and bespoke report showing how much you could earn through FIT for solar PV, try our Solar Energy Calculator.

Summary of hydro, wind and micro CHP tariffs

 Technology

 Tariff band

 (TIC kW)

 Generation Tariff

 Export tariff

 Eligibility date

 1 Oct 2015 to 14 Jan 2016

Hydro

15 or under

15.45 p/kWh

4.85 p/kWh

 

>15 - 100

14.43 p/kWh

4.85 p/kWh

Wind turbine

1.5 or under

13.73 p/kWh

4.85 p/kWh

 

> 1.5 to <15

13.73 p/kWh

4.85 p/kWh

 

>15 to <100

13.73 p/kWh

4.85 p/kWh

Micro-CHP

2 or under

13.45 p/kWh

4.85 p/kWh

 

For hydro, wind and micro-CHP:

  • Evidence of property’s EPC rating is not required for these technologies.
  • The tariff period is 20 years for hydro and wind, 10 years for micro-CHP.
  • Microhydro (<50kW) accreditation has to go through the ROO-FIT process not MCS.
  • The definition of 'hydro generating station' has been extended to include small tidal projects.

Registering for FITs

Once your chosen installer has installed your generating technology, take these steps to register for FITs:

Ask your installer to register you on the central MCS database. The installer will then send you a certificate confirming MCS compliance.

Tell your chosen FIT supplier that you wish to register for the FIT and send them:

  • a completed application form
  • the MCS certificate
  • for solar PV, the Energy Performance Certificate that shows your home has an energy efficiency rating band D or better.

Your FIT supplier will:

  • cross-reference your installation with the MCS database and undertake other eligibility checks
  • confirm your eligibility and the date you are eligible for payments from
  • add you to the Ofgem Central FIT Register, which records all installations in the FIT scheme
  • agree with you if and when you will need to provide meter readings and when they will make FIT payments to you – these will form part of your statement of FIT terms.