Feed-in-Tarrif (FiT)

The government introduced the Feed in Tariff on 15th July 2009 to stimulate the growth in the market and drive down installation costs as volumes increased. Their plan worked very well but the market became very volatile and unstable as prices dropped and the government tried to control it by dropping the FiT payment rate. This eventually led to a market collapse with basically very few systems being installed in early 2013, but by summer 2013 the long standing and proffesional installers were still there to carry on the energy challenge. By late 2016 the decimation of the industry had continued and the driver for customers to install PV has changed from return on investment to securing enery supply and making future costs predictable and lower. Adding storage has developed this further. 

When the Feed in Tariff (FiT) started in 2009 at 41p/kwhr and with a 4kw peak system costing around £19,000 the return in investment was between 8% and 10%. Four years on and the installation price has dropped by 70%, the FiT has dropped the same and the return is still as good, despite the roller coaster ride that installers and customers have had during this period. A 4kwp system installed is now between £4500 and £8000 depending on the panel efficiency, type of inverter specified, and the complication of the work required to install the system.

With the current Feed in Tariff Higher payment rate of 4.18/kwhr at the 10kwp and under rate, and with the cost to buy in electricity currently more, typically 15p/kwhr, it now no longer makes sense to limit your system size to 4kwp to maximise your return, if you have room for more panels. There is no difference in payment rates between the sub 4kwp rate and the 4kwp-10kwp the rate is now the same, if you are using the electricity you are generating it is saving you 15p/kwhr, much greater than the FiT payment. In addition to this the cost/watt peak of the installed system decreases with economies of scale so the returns on investment can be higher. Adding storage increases savings and helps future proof energy bills.

The rate from 10kwp to 50kwp is 4.39p/kwhr, set higher than the domestic/small system rate to encourage business to generate some of their own power in the daytime - generation at the same time as consumption during the working day. 

To receive the full Feed in Tariff the building being supplied with the generated energy must be reasonably energy efficient and must achieve an Energy Performance Certificate (EPC) rating of "D" or better before the PV is installed, we can arrange an assesment or you can look here  to find an assessor near you. If your building does not reach the necessary EPC level the lower tariff rate will apply.