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Feed-In Tariffs (FITS)

What are the FITs?


The tariffs are payments to anyone who owns a renewable electricity system, for every kilowatt hour they generate. They are applicable to households, businesses and, indeed, virtually any property owner.


How much is paid?


Up to 41.3p/kWhr, depending on the type and size of the system used to generate renewable energy. For detailed information, visit www.ofgem.gov.uk.


Plus an additional 3p/kWh when you export any surplus back to the grid.


Also, you reduce costs on your electricity bill when you use your own energy.


For how long?


Tariffs are paid for 20 years, except solar systems installed before 1st August 2012, which qualify for 25 years. Tariffs are index-linked to RPI.


Is that enough?


These tariffs should cover the initial capital cost of installation and, according to the Government, earn a return up to 8% p.a. In practice that means you should earn back the capital cost at least two to three times over the duration of the tariffs.


When do they start?


Tariffs became payable in April 2010. All qualifying systems installed now are eligible.


Any restrictions?


The tariffs apply to all the technologies shown in sizes up to 5 megawatts (plenty for most consumers and businesses). There are technical and accreditation requirements but our recommended suppliers will cover all this on your behalf.


However the government is now reviewing the scheme, so things may change.


How can I benefit?


Anyone who owns a property can benefit from the Feed-In Tariffs offered.


How is the electricity measured?


Meters will be needed to measure each of the three energy flows (generation, import and export).


- You already have an import meter because that's the one your electricity bills are based on. Some of these can also measure the exports back to the grid.


- A generation meter is included as part of any eligible renewable system you install.


However the whole country is changing over to 'Smart Meters' in the next few years, and they will be able to cope with all this.


Interim approach to exports


To prevent the need for installing an additional export meter before Smart Meters are introduced, it will be possible to 'deem' the level of exports as 50% of the total generation of the system.


Generators who believe their exports are substantially higher than this will be allowed to install suitable export meters and be paid on the metered level of exports.


Reading the meters


The requirement for providing these readings will vary for different suppliers.


Once Smart Meters are introduced the meters can be read remotely and some companies already offer this service.


Otherwise your supply company may arrange for the meter reading or they may ask energy users to provide the readings.


Planning Consent


Most renewable energy installations at the domestic level are covered by so-called 'permitted development' (so they don't need planning permissions), except


- In conservation areas or on listed buildings


- Wind turbines and air-source heat pumps


- If they are above certain sizes


Non-residential installations do need permission, except inside existing buildings.


Connection Approval


Whenever electricity generating installations are connected to the grid, it is necessary to notify, or seek approval from, the Distribution Network Operator (DNO) responsible for that part of the grid. The requirements are:


- For small systems less than 16 amps per phase; to conform with Engineering Recommendation G83, which requires the DNO to be notified


- For larger systems; to conform with G59, which requires prior approval from the DNO. There may also need to be upgrades to the grid for which the new plant owner may be liable (the DNO will advise).