UK Government Fit (Feed In Tariff) How It Works

December 21, 2017

Individuals and companies looking to reduce their energy consumption, carbon emission while making some money will find the Feed-In Tariff scheme (FITs) a suitable proposition. This environmental initiative was introduced on 1st April 2010. It’s only applicable in England, Scotland and Wales.

Like the domestic RHI programme, the FITS programme strives to encourage the generation of small renewable and low carbon electricity. The bigger picture is to help the UK government to meet its renewable energy targets by 2020.

Once a generating entity qualifies for the financial incentives, there is a guaranteed unit tariff payment that stretches to 20-25 years for every unit generated and exported back to the main grid.

The management and administrative functions of the FITS scheme are overseen by the Department of Business, Energy, and Industrial Strategy. This body is charged with policy and decision making and legislation issues. For administrative functions, energy giant; Ofgem E-Serve takes the helm alongside energy suppliers also known as FITs licensees.

These licensees together with Ofgem take charge of applications and payments. For large energy suppliers, there is a requirement for them to be legalized as FITs licensees, but the smaller suppliers are not required to do the same in law.

How Do I Benefit Through FITS?
For eligible generating entities you can benefit from FITs payments in three ways:
Through the generation tariff (G)

This is a fixed rate payable to households for the total amount of energy generated, it’s calculated per kWh and the payments that run for 20 years are index-linked. These rates vary depending on when you registered the type and the size of your installation.

Export tariff
This tariff is paid by your energy supplier for every unit you export back to the grid. You can sell excess output that you don’t need. This rate is sometimes estimated to be 50 percent of the total kWh you generate. You only need to have a metered system if your installation exceeds 30kWp. The export tariff is equally index linked.

Energy savings fits
When you generate electricity, you don’t have to buy too much from energy suppliers for your daily usage. This translates into direct savings

What Technologies Qualify For FITS?
A number of low carbon and renewable energy technologies are eligible for the FITS payments. These include:
• Solar PV systems with a total installed capacity (TIC) of 5MW or less.
• Wind turbines with a TIC of 5MW or less.
• Hydro systems with a TIC of 5MW or less.
• Combined heat and power systems with a TIC of 2kW or less.
• Anaerobic digester units with a TIC capacity of or below 5MW.

Additional Needs
Other qualification requirements stipulate that the installing authority such as the HP energy and the products used must be Microgeneration Certification Scheme certified. Hydro and anaerobic digesters are an exception here. Remember, tariffs paid depend on the eligibility date. For solar PV, your home’s Energy Performance Certificate rating is a determining factor.

For eligibility purposes, your system needs to be commissioned, and the feed-in tariff supplier should have received your application.

How Does The Scheme Work?
FIT payments are remitted on a quarterly basis for the units you have generated and exported. These payments are calculated according to the meter readings you submit to your fit licensees.
For new applications, the number of payments under the FITS scheme is capped. These are known as deployment caps. You need to be conversant with the FITs queuing system, if you want to start receiving your payments ahead of other applicants.

How to Apply?
There are two ways you can follow to apply for the FITs support. They are determined by the size and the type of your installation.
For small installations including home-based, small business solar PV, wind or CHP systems, you should submit your application to an energy supplier. This is known as the MCS-FIT accreditation. For instance, if you are fitting PV panels on your roof, this is the ideal route to follow.

Large installations such as commercial wind, solar PV, hydro and anaerobic digesters applications are made to Ofgem. This is known as the ROO-FIT accreditation.
To make the most out of the FITS support and payments, you can find more info on their website.

But before you make a move, always ensure that your home or property is energy efficient. Remember, as of April 2012, your home must have an energy performance certificate with a D-rating (calculated on an A-G scale with an A-rating being the perfect efficiency rating.) this mean your home need to be as efficient as possible for your investment to make sense.


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