UK Financial Incentives - Feed-in-Tariffs

The UK Government is committed to increasing the use of low-carbon technologies and provides financial incentives in the form of Feed-in-Tariffs (FITs) for solar PV, Renewable Heat Initiatives and other types of renewable projects as well Green Deal incentives.

The UK Government is legally committed to meeting 15% of the UK energy demand from renewable power sources by 2020, which will help secure the UK’s energy supply and achieve its carbon reduction objectives. Renewable technologies therefore have a crucial role to play in the UK’s energy mix and help to make the most of the UK’s natural resources including solar, wind, thermal and tidal power. UK Government initiatives include:

  • Renewables Obligation (RO): provides incentives for large-scale renewable electricity generation by making UK suppliers source a proportion of their electricity from eligible renewable sources.
  • Feed-in Tariffs (FITs) scheme: pays energy users who invest in small-scale, low-carbon electricity generation systems for the electricity they generate and use, and for unused electricity they export back to the grid.
  • Renewable Heat Incentive (RHI): pays commercial, industrial, public, not-for-profit and community generators of renewable heat for a 20-year period.
  • Renewable Heat Premium Payment (RHPP): gives one-off payments to householders, communities and social housing landlords to help them buy renewable heating technologies like solar thermal panels, heat pumps and biomass boilers.
  • UK Renewable Energy Roadmap: sets out a plan for accelerating the use of onshore wind, offshore wind, marine energy, solar PV, biomass electricity and heat, ground source and air source heat pumps, and renewable transport.
  • Renewable Transport Fuel Obligation: makes companies that supply more than 450,000 litres of fuel per year source a percentage from renewable sources support for other renewable technologies, eg heat networks.
  • ‘Connect and manage network access regime’and other actions to make sure new generators can connect to the electricity network in a timely, secure and cost-effective way.

The Electricity Market Reform proposals also provides support for renewable electricity generation from 2014 onwards. The following tables provide information on the available incentives and tariffs.

Solar PV Installation Tariffs

Tariff BandFIT Rate (p/kWh)
< 4kW14.90

Domestic Renewable Heat Initiative Tariffs

TechnologyFIT Rate (p/kWh)
ASHP – Air Source Heat Pumps6.90-11.50
Biomass Boilers5.20-8.70
GSHP12.50 to 17.30
Solar Thermal17.30

The Domestic RHI is scheduled for the summer of 2013 and will apply to all eligible installations installed from July 2009.

EcoPowerSupplies has also collated other data which can be considered when investigating renewable energy projects.

Carbon Emission of Different Heating Fuels

Fuel SourceCarbon Emitted (kg)Carbon Dioxide Emitted (Kg)
Heating oil17216307
Wooden pellets272997
Natural Gas12804692
ASHP – Air Source Heat Pumps11354161
GSHP – Ground Source Heat Pumps8663175

The above figures are based on the 23,000kWh needed to meet a household’s annual heating and hot water needs with Conversion Factors obtained from The Carbon Trust.

Generation Tariffs For Non-PV Technologies

TechnologyBand (kW)Tariff from 01/04/13 (p/kWh)
>1.5 =<1521.65
>15 =<10021.65
>100 =<50018.04
>500 =<15009.79
>1500 =<50004.15
>15 =<10020.21
>100 =<50015.98
>500 =<200012.48
>2000 =<50003.23

(Source: OFGEM)

Non-Domestic RHI Rates

Tariff NameEligible TechnologyEligible SizesTariff rate (p/kWh)Tariff Duration
Small BiomassSolid Biomass; municipal solid waste (inc CHP)Less than 200kWhTier 1: 8.3, Tier 2: 2.120
Medium BiomassSolid Biomass; municipal solid waste (inc CHP)200kWth and above, less than 100kWthTier 1: 5.1, Tier 2: 2.120
Large BiomassSolid Biomass; municipal solid waste (inc CHP)1000KWth and above120
Small Ground SourceGround source heat pumps, water source heat-pumps, deep geothermalLess than 100kWth4.720
Large Ground SourceGround source heat pumps, water source heat-pumps, deep geothermal100kWth and above3.420
Solar ThermalSolar thermalLess than 20kWth8.920
BiomethaneBiomethane injection and biogas combustion, except from landfillBiomethane all scales, biogas combustion less than 200kWth7.120

(Source: OFGEM)

Green Deal Cashback Scheme – example rates

Energy Saving MeasureCashback
Loft Insulation£100
Cavity Wall Insulation£250
Solid Wall Insulation£650
Draught Proofing£50
Heating Controls£70
Condensing Oil Boiler£310
Condensing Gas Boiler£270
Double/Tripple Glazing£20 per m2 (up to £320)

Some data sourced from RenewableEnergyInstaller.co.uk

EcoPowerSupplies can also source finance capital for Solar PV projects.

For more information or to discussion our renewable energy solutions please contact us.