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Feed in Tariff

Solar Panels Feed in TariffThe Feed In Tariff is a government scheme which pays households or business with photovoltaic solar panels. There are two types of solar panel - those that generate hot water ("thermal" panels) and those that generate electricity ("PV" or "photovoltaic" panels). The Feed In Tariff (the FIT) applies to photovoltaic panels only.

The FIT is a national government scheme that means you can get paid for every unit of electricity that you generate (currently 21p per unit). You can then sell back the extra electricity that you generate but do not use to the National Grid for an extra 2p per unit. Therefore, if you're not using as much electricity as you're generating, then you'll be getting paid by your electricity supplier at 23p (roughly) per unit of electricity sold. When you do use the electricity that your panels supply (ie if you boil a kettle in the middle of the day), then you'll get paid 21p per unit that you've generated and you'll also make a saving on your electricity bill because you won't have to use electricity from the National Grid which you would normally buy for approximately 12p per unit - you'll be producing it yourself. At night time, when the panels aren't generating electricity, you simply use your regular electricity supplier, so the two systems run at the same time in parallel with each other.

  • The Feed In Tariff for PV panels is currently available for the whole of the UK
  • You earn 21p per kWh of electricity sent to the main grid
  • This, when combined with the average reduction expected in your electricity bills, comes to £750 to £1,500 per year
  • This payment is guaranteed by the government for 25 years, is index-linked (ie it rises with inflation), and it is tax free
  • The panels themselves cost approximately £7000 to install
  • PV panels pay themselves off over 10 years on average, so you'll then get payments and savings for the rest of the 25 year FIT period
  • Average rate of return is 7% - a very good investment, because the government wants you to use green energy! Get a quote to find out exactly how much this would be for your household, and how much solar panels would cost.