What You Should Know about Feed in Tariff Changes
Note: The Feed-in Tariff scheme has now officially ended. All existing registration under the scheme will continue to receive payments, however, no new applications will be processed.
The solar PV Feed in Tariff in the UK is ending on 31 March 2019, but if you submit your FIT application on or before this day, your application could still be approved after the closure date—provided your installation fits within a deployment cap.
Therefore, if you are thinking of installing a solar panel, it would be a smart move to act quickly in order to still qualify for the Feed in Tariff payments from 2019 onward. The closure of the government FIT scheme should not deter you from installing a solar panel in your home, because you could still reap the benefits of FIT payments over the next 20 years.
By installing a MCS-certified solar panel in your home, you can then apply for the Feed in Tariff with a FIT-licensee. If this application is submitted before the cut-off date, you could still qualify to receive the payments for using the renewable energy.
Read Our Guide on the Latest Feed in Tariff Changes
This article will offer information about the latest Feed in Tariff changes and what you need to do to still benefit from it before it ends in 2019.
- How Does the Feed in Tariff Work?
- Deployment Caps and Feed in Tariff Rates
- Application Process for Small-Scale Solar PV Installations
- When You Will Receive Your FIT Payments
- Don't Miss out on the Solar FIT Scheme
The Feed in Tariff in the UK is a government scheme that was introduced in 2010 and encourages homeowners to opt for an array of small-scale renewable low carbon energy technologies. The technologies covered by the government FIT scheme are solar PV, wind, hydro, anaerobic digestion, and micro-combined heat and power.
The category of solar PV can be further split up into two categories, according to their Declared Net Capacity (DNC):
- Small scale installations (MCS-FIT). If your installation has a capacity of up to 50kW, then it is categorised under the microgeneration certified scheme. This must be installed by an MCS-certified installer. The average domestic solar panel installation is 4kW, therefore most homeowners would fall into this category.
- Large scale installations (ROO-FIT). If your solar PV installation is a large-scale one and exceeds a DNC of 50kW and has a total installed capacity up to 5MW, then it is considered under the ROO-FIT category.
The Feed in Tariff is split up into four periods per year, which have their respective deployment caps. These deployment caps have a limited energy capacity - they are not determined by number of installations. Once a deployment cap has been filled, no more installations can qualify for FIT payments in that period.
In 2019 there is only one tariff period left, which is the first quarter of the year: 01 January - 31 March. In order to qualify for the Feed in Tariff before it ends in 2019, your installation must fall under this deployment cap.
If your application is processed after the deployment cap has been filled, it will go into a ‘queue’. You could still become eligible for the Feed in Tariff payments if there are cancellations in the cap you want to qualify for, therefore freeing up space.
The Feed in Tariff rates are dependent on the deployment cap your installation falls under. The rates have been determined for each tariff period until the end of the scheme, which is 31 March 2019. The rates are reduced with each period, which is called default degression. Simply put, this means that every three months the rates decrease.
Furthermore, if the deployment cap is filled within the period, then the rates will degress by an additional 10%, which is called contingent degression. For further information about specific Feed in Tariff rates, it would be best to consult your FIT-licensee.
Did You Know?
A deployment cap determines the total capacity that can qualify and receive payments under the Feed in Tariff scheme. These caps are measured by their total capacity, rather than the number of installations.
To see if you can fall under the last deployment cap, you can check Ofgem’s weekly deployment update. This update reveals the status of the caps of all technologies within a given period.
In order to benefit from the FIT payments, you have to follow the application process and fulfil all criteria.
For small-scale solar PV installations (MCS-FIT) you have a few things to do in order to qualify.
- Get an Energy Rating D (or Better). Ensure your home is energy efficient enough to begin with, to make the FIT a good long-term investment. Before getting a solar panel installed you will need an Energy Performance Certificate (EPC) with a rating of D or above. If it is not at this level, it may cost a lot to get the efficiency up to this level, so bear this in mind. The EPC rating has to be commissioned within 10 years of the FIT application.
- Get an MCS-Certification and Registration in the Database. Commission an MCS-certified installer to install your solar panel. This installer will certify you and will also register you on the MCS database.
- Submit Your Application to a FIT Licensee. Your FIT-licensee, or ‘energy supplier’, will distribute the Feed in Tariff payments to you. The FIT-licensee does not necessarily have to be your installer or supplier of the panel. Any changes may affect your Feed in Tariff rates, so it is important that you update your FIT-licensee if you replace parts or make any changes to your solar PV installation.
Once you have signed the FIT terms and have provided the meter reading to your FIT-licensee, then you can start collecting payments. This is referred to as your eligibility date. Once you have submitted the meter reading, you should receive a payment within 90 days.
There have been many changes to the scheme so far, but as it stands currently, the eligibility date for applications that fall under the MCS-FIT scheme, that have been submitted on or after the 8th of February 2016, are the later date of these two:
- The day you submitted your application to the FIT licensee.
- The first day of the tariff period that your installation falls under.
Be sure to regularly send your meter readings to your energy supplier, as they are the ones that will calculate your FIT payments. Also report any changes to your solar PV installation, because this could affect your rates.
Since the introduction of this scheme, the number of solar panel installations grew exponentially, as the FIT rates were so generous. Over time, the government made numerous cuts to the FIT rates, and has now ultimately deemed that renewables like solar panels are now affordable enough that they no longer need to be subsidised. By 31 March 2019, the Feed in Tariff will be scrapped.
Although this government scheme is coming to an end soon, you can still benefit from it over the next 20 years—if you act fast enough.
Aside from solar PV, there is another type of solar energy that is subsidised by the UK government, namely solar thermal. Solar thermal is used for heating, and is covered by the Renewable Heat Incentive (RHI) scheme. The government has not announced any plans to scrap this incentive.
If you are interested in buying a solar panel to still benefit before the Feed in Tariff ends, then simply fill in the contact form above and GreenMatch will provide up to four quotes of different suppliers in your area. This service is completely free and non-binding.