Feed in Tariff
The Department of Energy and Climate Change introduced the Feed in Tariff for renewable energy in April 2010 to incentivize homes and businesses into installing renewable energy systems. The DECC Feed in Tariff will pay households and businesses for every kilowatt of electricity produced using renewable energy sources such as solar panels an wind turbines. Up to 41.3p per kilowatt hour (p/kWh) will be paid for energy used by the household or business generating the renewable electricity and an extra fixed payment is added for each unit of electricity exported to the national grid. Initially, it will be estimated that 50% of energy consumption will be exported until the introduction of smart meters.
Generation - Every kilowatt of power produced will be paid for by the DECC for energy produced by Solar Panels, Wind Turbines, Anaerobic Digestion, Micro-CHP and Hydro Power.
Export Tariff - 3p per kilowatt hour (p/kWh) will be paid as an additional payment for each unit exported back to the national grid. This export will help the national grid provide renewable energy to other homes. The export tariff is paid at the same rate for all renewable technologies.
Energy Cost Savings - The less electricity that is imported from the national grid, the cheaper energy bills will be and the more profit is to be had from energy exports.
The generation and export features of the Feed in Tariff will eventually be handled by the installation of smart meters that will be able to calculate how much renewable energy is being generated and used. It will also be able to calculate accurately how much power was imported from the national grid for use and how much renewable energy is exported back to the grid. Smart meters are very accurate and will share information with one of the main energy providers in the UK who will be responsible for making the payments to households and businesses in the Feed in Tariff for renewable energy.
Although renewable technology may sound like a new concept it has been under consideration for many years as governments tried top work out how best to tackle climate change effectively. The Microgeneration Certification Scheme (MCS) was founded to create and maintain industry standards of workmanship and product quality within the renewable technologies market in the UK. The DECC consult the MCS on best practice by energy professionals and only energy companies accredited by the MCS are approved to supply and install renewable energy systems eligible for Feed in Tariff inclusion. Those considering participation in the government's Fed in Tariff by installing renewable energy systems should only use MCS accredited installers.