What is The Feed-in Tariff (FIT)?
The Feed-in Tariff (FiT) is a government backed scheme that allows homes and businesses to get paid for producing electricity from solar panels
There are three ways in which you will financially benefit from a solar PV system through the FIT scheme.
Generation tariff – a set rate of will be paid by the energy supplier for each unit (or kWh) of electricity you generate. Under this scheme, you will be paid for every unit of electricity that you generate, whether you then use it yourself or export it from your site. The rate varies depending how large your system is (see Table below) but most domestic installations will fall under the highest FIT band. The FIT rate is guaranteed by Government legislation for 20 years for your PV system and is RPI index-linked and, for domestic systems, tax-free. This rate will change each year for new entrants to the scheme but once you join you will continue on the same tariff for 20 years for your PV system.
Export tariff – you will receive a further payment from your energy supplier for each unit you export back to the electricity grid (i.e. when it isn’t used on site). The export rate is the same for all technologies.
Energy bill savings– you will be making savings on your electricity bills, because generating electricity to power your appliances means you don’t have to buy as much electricity from your energy supplier. The amount you save will vary depending how much of the electricity you use on site.