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Feed-in tariff rates: the headline figures

Posted by Cathy Debenham on 2 February 2010 at 12:57 pm

At last the uncertainty is over - we now know what the rates are for the Clean Energy Cashback (feed-in tariff) which starts on 1 April 2010. Its purpose is to encourage installations of wind turbines, solar photovoltaic panels, micro hydro and microCHP schemes of up to 5MW capacity to produce low carbon electricity.

The feed-in tariff aims to provide an incentive for people to invest in microgeneration and expects to deliver a return of 5-8% for well-sited installations. It will consist of three elements:

  • A fixed payment from your electricity supplier for every kilowatt hour (kWh) your system generates. This is called the generation tariff. See below for rates.
  • A guaranteed price for any surplus electricity that you do not use on site, and export to the grid. This is called the export tariff and will also be paid by your electricity supplier. It has been set at 3p per kWh.
  • In addition, as you use electricity generated on site you will need less from the national grid – so your bills will be lower.

Unlike the export tariff (which at 3p per kW is less that the 5p consulted on) the generation tariff rates have increased since the consultation document was issued last year. For the first two years of feed-in tariffs (April 2010 - March 2012) they will be as follows: 

Hydro:
19.9p for installations up to 15kW;
17.8p for 15-100kW;
11p for 100kW-2MW;
4.5p for 2-5MW,
Paid for 20 years

Solar photovoltaic panels:
41.3p for installations of less than 4kW retrofitted onto an existing building (36.1p if it is on new build);
36.1p for 4-10kW;
31.4p for 10-100kW;
29.3p for 100kW-5MW and for stand alone systems
It will be paid at these rates for 25 years.

Wind:
34.5p for installations with a capacity of less than 1.5kW;
26.7p for 1.5-15kW;
24.1p for 15-100kW;
18.8p for 100-500kW;
9.4p for 500kW-1.5MW;
4.5p for 1.5-5MW
Paid for 20 years.

MicroCHP pilot:
10p per kW for micro combined heat and power installations. This will support up to 30,000 installations and will be reviewed when the 12,000th system has been installed. It will be paid for 10 years.

Existing microgenerators (under 50kW) who installed their system and were accredited under the Renewables Obligation before 15 July 2009 will automatically be transferred to the feed-in tariff at a generation rate of 9p per kWh, regardless of technology. This will be paid until 31 March 2027.

Microgenerators who installed pre 15 July 2009 and are not accredited under the RO will not be eligible for feed-in tariffs.

Inflation: Both the generation tariff and the export tariff will be indexed to the retail price index.

Tax: In the 2009 Pre-Budget Report the Chancellor confirmed that households which use renewable technology to generate electricity mainly for their own use will not be subject to income tax on feed-in tariffs.

The rates above are for those installing their system between 15 July 2009 and 31 March 2012. You will remain on that rate (plus inflationary rises) for the life of the tariff. From 1 April the rate that new generators get will begin to reduce (“degress”) to reflect (and to some extent encourage) expected decreases in technology costs.

Low Carbon Building Programme grants for microgeneration installations are now closed, and all the money has been transferred to the renewable heat technologies.

Full details of the Government response to the FiTs consultation can be downloaded from the DECC website.

Photo by lipstickproject

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Comments

6 comments - read them below or add one

Cathy Debenham

Cathy DebenhamComment left on: 1 June 2011 at 8:30 am

Hi Grasmere

It is expected that tariffs for new installations after 1 April 2012 will be lower than for people who install this year. This 'degression' has been built into the design of the feed-in tariff, as it's aim is to grow the market, and the expectation is that the cost of installation will fall as the market grows. In fact prices have fallen quite considerably already, although the cause is more likely to be global, than UK influenced.

However, if you're installing now, it won't affect you. You will get the rate available now (ie 43.3p per kWh - it went up in April this year), indexed to the retail price index, for 25 years.

Click on the link in the first paragraph if you want more detail.

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Grasmere

GrasmereComment left on: 31 May 2011 at 10:04 pm

Cathy

I have just printed off a tariff list fron Ecotricity and they are suggesting that the tarriff for Year 3 1/4/12 to 31/3/13 is going to drop from 41.3p to 37.8p can you confirm.

 

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Anonymous

AnonymousComment left on: 28 July 2010 at 9:40 am

We have recently added a Feed  in Tariff calculator to our website. We feel that it is the most interactive and dynamic calculator in in the UK. Hope that you may find it useful.

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Brenda G

Brenda GComment left on: 9 February 2010 at 5:31 pm

The Guardian Money section published a positive and informative article on Saturday, with an article by Asley Seager who actually uses pvc panels. www.guardian.co.uk/money/2010/.../solar-power-bright-investment -

It doesn't deal with the loss in payback to "pioneer"  installers, particularly those who received the lower grant towards the cost of installation.

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ePower-Solar

ePower-SolarComment left on: 4 February 2010 at 5:59 pm

I believe that a step in the right direction has been taken by the authorities, though I am sceptical whether this will be sufficient to create the much needed demanded in order to bring to live a well functioning market with sufficient liquidity. Considering the lower irradiation per sqm in the UK, the lower tariffs and the higher costs for the components I would not invest a single cent in it.

In Germany we currently have spot prices of around 1,40 - 1,60 GBP for EU panels, and even cheaper panels comming straight from China (LDK-Solar, Yingli, Suntech and so on). It adds up to a price of around 2270 GBR / kW (residential systems) including installation and all components. Still, most of the investments fonds and big money spenders in photovoltaics are going to invest there money in Italy nowadays. From an economical point of view there are better opportunities to invest your money, but if you want to act locally than it might be an idea to build a solar system on your house and there by encouraging others to do the same. 

Our company is involved in 12V Solar Systems (Off - Grid) and in the spot market trading of higher volumes of solar panels. Would be interesting to see how the market in GBR will react in the near future.

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Barry Nutley

Barry Nutley from Viridis Energie ConsultantsComment left on: 2 February 2010 at 4:23 pm

Whilst many may say that this is not enough? Let's centre on the positives- An increased payment scheme which is index linked. True the export figure is lower, but the the former more than compensates for that?

With this in mind, what we do need to ask ourselves, is "where else can we get this level of return (guaranteed) from our investment?" If anyone can tell me then please do.

So, let's focus on this, and start spreading the "word", as if we don't, this will be the reason for people not taking up this opportunity? So, far I've only heard a very vague lady from the REA talking about it on Radio 2 for about 1 minute, and this is the only "report" I've so far heard about the scheme in the "mainstream" media?

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