The latest Government solar power tariffs explained

The Government have made the solar energy tariffs pretty complicated, so let’s see if we can simplify it for you! 

(And if anything’s still unclear, just give us a call and we’ll be happy to explain things to you.)

How does the scheme work? The Feed-In Tariff pays  you for all the electricity that is produced by your Solar PV system.  A Generation Meter measures how many kilowatt-hours (kWh) your system has produced and you provide this figure to your electricity supplier four times a year.  They then pay you for the electricity that you have produced.

How much do they pay?  This is the complicated bit.  The amount that your electricity supplier pays per kWh is called the tariff, and there are different rates for different sizes of Solar PV system.  The highest tariff is for roof-mounted systems on houses, schools and factories and small ground-based schemes . It’s it a little lower for larger commercial systems and huge ground-based solar parks.  The table below shows the current tariffs.

So I get paid for the surplus electricity my system exports to the national grid, right?  Wrong!  The ‘Generation Tariff’ is actually paid on ALL the solar power you produce, WHETHER YOU USE IT OR NOT.

There is also an additional ‘Export Tariff’ which, in theory, pays you for surplus power that you feed into the grid, but for domestic-size systems (and commercial ones up to 30kW in fact) this is simply estimated.

So, rather than having to install an additional and expensive ‘Export Meter’,  your electricity supplier assumes that you will export 50% of what your solar panels produce, and they simply add that onto the payments they make to you.

So for a typical 4kW home system, you’d get 12.47p per kW from the basic generation tariff plus half of the 4.85p Export Tariff, so 14.9p per kW in total.

If your solar panels are on an unshaded south-facing roof, this will earn you in the region of £520 in year one, rising annually in line with the RPI (retail price index) over 20 years.

How long do I get paid for?  This tariff is guaranteed for 20 years, index-linked to inflation, and tax-free as long as you are the occupant of the house.

I’ve heard that the Government keep on reducing the tariff, so what’s the point?  There are a lot of misconceptions around concerning this!  The facts are these:  once you have your system installed and you are signed up, the Tariff is guaranteed for 20 years. In fact it is likely to increase as it is adjusted in line with inflation every year.

The misunderstandings arise because the government  reduces the tariff every three months for NEW ENTRANTS to the feed-in scheme, because they expect the cost of the equipment to drop in the future.  But please note: the tariffs are never reduced retrospectively for those already signed-up.

How much will I save on my electric bills? In addition to the income from the Feed-In Tariff, you will also see a reduction in your electricity bills.  The exact amount depends on a) the size of your PV system, b) the amount of electricity you consume and c) when during the day you consume it. A typical 4kW home solar power system could save you up to £100-200 per year (at current power prices).

The Current Tariffs

The Tariffs payable for systems installed before December 31st 2015 are as follows:

 

Band                      Generation      Export

                                   Tariff             Tariff

Less than  10kW           4.32p             4.91p

10-50kW                        4.53p             4.91p

50-250kW                      2.38p            4.91p

Note that the 50% ‘deemed export’ only applies on solar energy schemes up to 30kW. A typical home Solar PV system is around 4kW.

Important: your energy efficiency rating

If the Solar PV system is attached to a habitable building then that building must have an Energy Efficiency rating of ‘D’ or better to qualify for the full tariff.  Where this Energy Efficiency rating is not met a you’ll receive a Generation Tariff of 0.74p.

Generally, however, any home with double glazing, good loft insulation and some additional efficiency measures should reach this standard. (And installation of a Solarbarn solar PV system can often move a home into the D bracket if it wasn’t before.)

Getting your home surveyed for your Energy Performance Certificate would normally cost you around £100 but Solarbarn will undertake your ‘EPC’ survey completely free as part of the solar installation.