Feed-in Tariffs

Following the Energy Act 2008, the government has introduced a Feed-in Tariff as of April 2010 covering the generation of electricity from renewable sources. This brings the UK into line with many European countries who already have a feed-in tariff. In Germany, Spain, France and Italy the introduction of a feed-in tariff for renewable electricity has resulted in a massive growth in the installation of solar PV, wind and other renewable energy systems both for domestic and commercial systems. It is anticipated that we will see a similar effect on the UK renewable energy market.

The feed-in tariff applies to projects of up to 5MW generating electricity from a range of technologies.

The Feed-in Tariff is only applicable to renewable electricity. There is a separate Renewable Heat Incentive for heat energy which will be introduced in 2011. The feed-in tariff is applicable to the following technologies:
  • Hydro
  • Solar PV
  • Wind
  • Biomass
  • Anaerobic Digestion
  • micro CHP
The Feed-in Tariff replaces the existing Low Carbon Buildings Programme grant scheme. Further information on Feed-in Tariff rates is available at our companion website www.RenewableEnergyTariff.co.uk.

The Feed-in Tariffs cannot be used in conjunction with other government grants due to state aid rules.

The level of Feed-in Tariff will obviously affect the return on investment. The industry view is that an ROI of at least 10% is required by both domestic and commercial customers. At current proposed rates the ROI is more like 4-8%.

If you want to know how the Feed-in Tariffs including the proposed Pay As You Save (PAYS) scheme will impact your renewable energy projects contact us we can model the finances of your project using the industry standard RETScreen software, and provide advice on the best funding methods.