Introduced in April 2010, the Feed in Tariff (FIT) is a scheme designed to encourage and reward people who invest in electric generating renewable technologies. The government has set in stone a 25 year payment plan for all customers who install a solar PV system in 2010 and beyond.
The rate as of 1st April 2011 is 43.3 pence for every kiloWatt of electricity your system produces, and is income tax free. So even if you use all the electricity your solar PV system produces you still receive 43.3p per kiloWatt guaranteed for 25 years.
On top of this, you will also save on the electricity that you do not have to acquire from your electricity provider. This means that on a standard 2 kWh system you will save an additional £200 per year AND earn over £680 from the feed in tariff.
If you manage to produce more electricity than you consume any excess will be exported back to the national grid and you will receive a further 3p per kiloWatt for this.
From the 1st April 2011 the FIT rates for solar PV systems up to 4 kWh-p has increased by the Retails Price Index to 43.3 p/kWh, a rise of 4.8% and will continue to rise by inflation each year.
