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Feed In Tariff (FIT)

The Feed In Tariff is simple in concept but less so in execution.

We've put together our guide to the Feed In Tariff to help you understand its impact and potential benefit to your business.

We have split the guide into four key sections, each focusing on a particular element and perspective of the scheme:

  • What is it?
  • How can your business benefit?
  • How can we help?
  • How much does it cost non-participants?

Put simply the Feed In Tariff or its commonly used abbreviation FIT is a charge on all business electricity customers to reward, compensate and benefit those customers who have access to their own generation and who therefore take pressure and reliance off the main generating grid.

It is related to, but not the same as the Renewable Heat Incentive (RHI)

The monies collected via electricity bills are recycled by energy suppliers and used to reward businesses with what is known as ‘embedded generation'.

This may sound grand or complex however it can be as simple as having a solar panel fitted to the roof of your premises.

The government scheme that underpins FIT was launched in April 2010 in order to “encourage the uptake of small-scale renewable electricity generation”.

The FIT concept is part of a number of protocols, initiatives and policies that successive governments have brought in to fulfil the obligations they face from over-arching EU environmental legislation.

The beauty of the FIT scheme is that following initial investment, not only will you be saving money by generating your own electricity, you'll also get paid for the electricity you generate (a generation tariff) and if you generate more than you need you could be paid for ‘spilling' that energy back into the ‘grid' (an export tariff).

So:

  • You'll be paid for each kWh of electricity you generate, even if you use it yourself, this is known as the Generation tariff, which although dependent on the energy source used, is a set rate for each unit generated, index linked and guaranteed for the period of the tariff (up to 20 years);
  • You'll be paid for any surplus kWh of electricity you export to the grid, this is known as the Export tariff, and is a uniform p/kWh payment regardless of energy source used; and
  • You'll save money on your electricity bill, because you'll be using your own electricity!

Organisations, such as the energy suppliers, can apply to be Feed In Tariff Licensees, others are mandated to do so, as a result eligible customers can always be sure that they have a ready market and a compensatory framework through which the potential rewards can be delivered.

Firstly your premise or premises will need to have an eligible renewable energy generation source installed.

Eligible sources include:

  • Solar panels (roof mounted or stand alone)
  • Wind turbines (building mounted or free standing)
  • Hydroelectricity
  • Anaerobic digesters
  • Micro combined heat and power (CHP)

These can be further segmented into Photovoltaic sources (PV) and non-photovoltaic sources (non-PV).

  • Your generation address will need to be registered with and recognized by the Post Office.
  • Your premise' generation capacity will need to be less than 5MW.
  • Your installation and installer must be certified under the Microgeneration Certification Scheme (MCS) or it if is hydro or anaerobic digestion this will be subject to the ROO-FIT process.
  • You'll need the installer to have registered the install on the central MCS database and to have received a certificate of MCS compliance from them.

Once the equipment is commissioned for use on your premise, you will need to approach a FIT Licensee so that you can be officially registered on the Ofgem Central FIT Register in order to be eligible to receive any applicable generation and export tariff payments from your FIT Licensee.

As part of this process you should contact Business Juice to help you select the best FIT Licensee for your needs.

Once identified you will need to provide your chosen FIT Licensee with the MCS compliance certificate, the application form (including MCS number), the meter reading(s) taken on the day of application submission, proof of ownership for the generation equipment on site i.e. copy of Final Paid Invoice, any required signed declarations and where applicable the EPC for your premise.

Despite having done this there is still more to do to receive your incentives.

Your eligibility date will need to have been agreed and for Solar installations your premise' Energy Performance Certificate (EPC) rating will need to be evaluated.

Your eligibility date will be the date your FIT Licensee receives a valid application for FIT recognition. This will more than likely be after the date on which your renewable electricity system is installed. The only departure from this process is for Solar installations, where these are additions to an existing system, the eligibility date will be the date of commissioning and not the date of any subsequent application.

Crucially you will only be paid for the energy you generate from the meter reading taken on the eligibility date.

The EPC plays an important role here too for Solar installations, the EPC, which must be dated prior to the commissioning date must be submitted with your application. If you fail to provide the relevant EPC or the EPC rating is below D you will receive the reduce tariff rate for your FIT award.

As a result it is therefore a crucial part of the process to efficiently complete the administration process that supports the FIT scheme.

Once all this is done, your premise will be ready to receive the compensatory tariffs from your energy supplier.

The Export tariff:
From01-Apr-1001-Dec-12
To30-Nov-12 
p/kWh3.444.85
The generation tariff for Solar PV:

Solar generation tariffs are reviewed every 3 months however once agreed they are guaranteed for the recipient for 20 years.

 On or after 1
January 2015
and before 1
April 2015
On or after 1
April 2015 and
before 1 July
2015
 Higher RateMedium RateLower RateHigher RateMedium RateLower Rate
Solar photovoltaic with Total Installed Capacity of
4kW or less, where attached to or wired to provide
electricity to a new building before first occupation
13.8812.496.3813.3912.056.16
Solar photovoltaic with Total Installed Capacity of
4kW or less, where attached to or wired to provide
electricity to a building which is already occupied
13.8812.496.3813.3912.056.16
Solar photovoltaic (other than stand-alone) with
Total Installed Capacity greater than 4kW but not
exceeding 10kW
12.5711.326.3812.1310.926.16
Solar photovoltaic (other than stand-alone) with
Total Installed Capacity greater than 10kW but not
exceeding 50kW
11.7110.546.3811.7110.546.16
Solar photovoltaic (other than stand-alone) with
Total Installed Capacity greater than 50kW but not
exceeding 100kW
10.349.316.389.988.986.16
Solar photovoltaic (other than stand-alone) with Total Installed Capacity greater than 100kW but not exceeding 150kW10.349.316.389.988.986.16
Solar photovoltaic (other than stand-alone) with
Total Installed Capacity greater than 150kW but not
exceeding 250kW
9.898.96.389.548.596.16
Solar photovoltaic (other than stand-alone) with Total Installed Capacity greater than 250kW6.386.16
Stand-alone (autonomous) solar photovoltaic (not wired to provide electricity to a building)6.386.16
EXPORT TARIFF4.854.85

For Solar PV that fails the EPC rating the uniform payment is 6.16p/kWh.

For systems with installed capacity in excess of 30kW an export meter will need to be fitted in order to more accurately measure the volume spilt onto the network.

The generation tariff for non-Solar PV - sources such as Hydro, Wind and Micro CHP:

Hydro and Wind installations generation tariffs are guaranteed for 20 years and 10 years for Micro CHP.

Currently, for eligibility dates from 1 April 2014 to 30 September 2014 the generation tariff rates are:

Hydro generating station with total installed capacity of 15kW or less

From01-Apr-1001-Dec-1201-Apr-1401-Oct-1401-Apr-15
To30-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh23.5622.5921.4619.3117.17

Hydro generating station with total installed capacity greater than 15kW but not exceeding 100kW

From01-Apr-1001-Apr-1401-Oct-1401-Apr-15
To31-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh21.0920.0418.0316.03

Hydro generating station with total installed capacity greater than 100kW but not exceeding 500kW

From01-Apr-1015-Mar-1301-Apr-1401-Oct-1401-Apr-15
To14-Mar-1331-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh13.0316.6715.8414.2512.67

Hydro generating station with total installed capacity greater than 500kW but not exceeding 2MW

From01-Apr-1001-Apr-1401-Oct-1401-Apr-15
To31-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh13.0312.3711.149.9

Hydro generating station with total installed capacity greater than 2MW

From01-Apr-1001-Dec-1201-Apr-1301-Apr-1401-Oct-1401-Apr-15
To30-Nov-1231-Mar-1331-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh5.274.823.373.373.042.7
Wind:

Wind with total installed capacity of 1.5kW or less

From01-Apr-1001-Apr-1201-Dec-1201-Apr-1401-Oct-1401-Apr-15
To31-Mar-1230-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh40.7638.5222.5918.0616.2614.45

Wind with total installed capacity greater than 1.5kW but not exceeding 15kW

From01-Apr-1001-Apr-1201-Dec-1201-Apr-1401-Oct-1401-Apr-15
To31-Mar-1230-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh31.5330.1222.5918.0616.2614.45

Wind with total installed capacity greater than 15kW but not exceeding 100kW

From01-Apr-1001-Apr-1201-Dec-1201-Apr-1401-Oct-1401-Apr-15
To31-Mar-1230-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh28.5127.3322.5918.0616.2614.45

Wind with total installed capacity greater than 100kW but not exceeding 500kW

From01-Apr-1001-Dec-1201-Apr-1401-Oct-1401-Apr-15
To30-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh22.1618.8315.0613.5512.05

Wind with total installed capacity greater than 500kW but not exceeding 1.5MW

From01-Apr-1001-Dec-1201-Apr-1401-Oct-1401-Apr-15
To30-Nov-1231-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh11.1910.218.177.366.54

Wind with total installed capacity greater than 1.5MW

From01-Apr-1001-Dec-1201-Apr-1301-Apr-1401-Oct-1401-Apr-15
To30-Nov-1231-Mar-1331-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh5.274.824.333.463.122.77
Micro CHP:

Combined Heat and Power with total installed electrical capacity of 2kW or less (tariff only available for 30,000 units)

From01-Apr-1015-Mar-13
To14-Mar-1331-Mar-16
p/kWh11.8413.45

For systems with installed capacity in excess of 30kW an export meter will need to be fitted in order to more accurately measure the volume spilt onto the network.

Anaerobic Digestion:

Anaerobic digestion with total installed capacity of 250kW or less

From01-Apr-1030-Sep-1101-Apr-1401-Oct-1401-Apr-15
To29-Sep-1131-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh13.6615.8212.6611.3910.13

Anaerobic digestion with total installed capacity greater than 250kW but not exceeding 500kW

From01-Apr-1030-Sep-1101-Apr-1401-Oct-1401-Apr-15
To29-Sep-1131-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh13.6614.6311.710.549.36

Anaerobic digestion with total installed capacity greater than 500kW

From01-Apr-1030-Sep-1101-Apr-1401-Oct-1401-Apr-15
To29-Sep-1131-Mar-1430-Sep-1431-Mar-1531-Mar-16
p/kWh10.669.649.649.148.68

Feed in Tariff – How can we help?

Here at Business Juice we can use our relationships with the full market of FIT Licensees to secure your business the optimum FIT deal. Whilst incentives are set centrally, the efficiency of the FIT Licensees in delivering timely and accurate payments and dealing with any administration issues can differ greatly.

Also errors in the submission and accreditation process can lead to costly delays in achieving your eligibility date, which can prevent you being paid for the electricity your site generates.

Business Juice will help your business ensure that the additional administration that underpins a FIT agreement is completed in accordance with rules and in a timely manner.

Business Juice will also secure you a perfect deal for the energy consumption your business does need to draw from the grid as well as being able to deliver low standing charge products in the event that no chargeable demand is being made on the metering system.

Feed in Tariff – How much does it cost non-participants?

In effect business electricity customers pay for the FIT scheme through their energy bills.

This cost equates to a charge of between 0.30p/kWh and 0.35p/kWh.

All energy suppliers are obliged to charge this regardless of whether they are a FIT Licensee or not.

To find out more about the Feed In Tariff, how your business could benefit or for helping find the right FIT Licensee and energy supply contract for your needs, simply call us on 0800 051 5770, we'd love to hear from you.