Feed in Tariff

Earn money for generating renewable energy

Feed-in Tariffs (FITs) are payments designed to encourage home-owners and businesses within the UK to generate green energy from renewable sources such as solar PV and wind turbines. They offer a genuine financial incentive to anyone using a renewable electricity generator with an installed capacity below 5MW.

The great attraction of FITs is the fact that they guarantee generators a long-term fixed price for the renewable energy they produce. The idea is to incentivise energy users to help the UK reach its target of generating 15% of total consumed energy from renewable sources by 2020.

The FITs incentive is easy to follow and has been designed to appeal in particular to first time generators – good news for everyone who is committed to green energy, especially those of us fortunate enough to live in Cornwall, Devon and the rest of the South West, where conditions are more favourable for photovoltaic (PV) and wind energy generation.

Making UK Feed-in Tariffs work for you

As an energy generator, you will receive both a ‘Generation Tariff’ and ‘Export Tariff’ – these will be paid by licensed energy suppliers.

1. Feed-in Tariff – a fixed rate that a generator will receive for every kilowatt (kW) of renewable energy generated regardless of where the energy is used
2. Export Tariff – a fixed 4.5p/kWh rate for the surplus amount of energy which is sent back to the electricity grid. This is currently deemed to be 50% of total generation for smaller installations.

The Generation and Export tariff is guaranteed for the lifetime of your project and is set for 20 years for Wind Turbine and Solar Photovoltaic (PV) projects respectively.

How much you could earn from Feed-in Tariffs

Renewable Energy is of course not all about the money – but it certainly makes a difference. The Feed-in Tariff incentive makes generating electricity profitable for the customer with a typical return in excess of 8%. The table below illustrates the Generation Tariff for different scales of solar energy and wind energy installations.

Technology	Scale (kW)	Generation Tariff (p/kWh)
PV	≤4kW (new build)	16
PV	≤4kW (retrofit)	16
PV	>4-10kW	14.5
PV	>10-50kW	13.5
PV	>50-250kW	7.1
PV	>250kW-5MW / Stand Alone	7.1
Wind	≤1.5kW	21.0
Wind	>1.5 – 15kW	21.0
Wind	>15 – 100kW	21.0
Wind	>100 – 500kW	18.0

Please note that these figures are linked to the RPI and will therefore follow inflation.

Three sources of income for renewable energy generators:

1. Generation Tariff (see table above)
2. Export Tariff (assumed 4.5p/kWh)
3. Saving on electricity bill (approximately 12-15p/kWh)

To make things a bit easier, here is a case study from one of our local wind turbine installations (please refer to the diagram above throughout):

Gaia 11kW wind turbine generating 30,000kWh per annum

1. Feed-in Tariff = (100% of 30,000kWh) x (28.0p/kWh) = £6300 per annum
2. Export Tariff = (50% of 30,000kWh) x (3.1p/kWh) = £675 per annum
3. Saving on Electricity Bill = (50% of 30,000kWh) x (12p/kWh) = £1800 per annum

This demonstrates that the overall income per year is £8,775. With a total installed cost of approximately £60,000, the turbine presents a simple payback period of 7 years.

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