Financial Considerations and Returns

What is the FIT?

The Feed In Tariff was introduced by the UK Government on the 1st April 2010 and is designed to encourage the small scale generation of electricity from renewable or low carbon sources such as solar panels (PV), wind turbines, hydro power or anaerobic digestion. Having installed an eligible system the scheme provides you with three different financial returns:

1. A guaranteed minimum payment for all of the electricity you generate, whether you use it yourself or not, for the life of the system. (PV is currently 25 years).
2. A guaranteed minimum payment for the electricity you don’t use and export to the national grid.
3. A saving of the equivalent purchase cost on the electricity that you generate and are able to use yourself in your home or business.

Notes:

• The Feed In Tariff payable for Solar PV is guaranteed for 25 years from its installation and registration date.
• The current value of the Feed In Tariff is guaranteed for all eligible systems registered from the 1st April 2012 until the 30th June 2012.
  Since the 12th December 2011, the Government have sought to reduce the Feed In Tariff for Solar PV systems in a series of steps starting in April 2012 and then again in July and October depending upon the level of installations completed.
  The current Feed In Tariff rates are in our Briefing Document which you can find on our News & Articles page.
• Whilst many consumers are currently paying between £0.11 and £0.15 per unit of electricity depending upon their electricity consumption and location, electricity costs are expected to increase at least in line with inflation in the coming years making the returns on the electricity you generate and use yourself even more important. Over the last 4 years electricity costs have risen by an average of 21%. OFGEM (The electricity regulator) have forecast that energy costs will continue to rise by as much as 50% over the coming 5 years.

As the tariff applicable during the period in which any eligible Solar PV system is completed and registered determines its income for the subsequent 25 years it is essential that those intending to invest in this type of renewable energy do not delay.

Whilst many organisations are keen to respond to your initial or first enquiry with a detailed but inevitably generic indication of the financial return you can expect from your investment, at Westflight Energy our experience has shown that attention to detail at the time of our initial survey is the key to providing you with the highest quality information based on all current and relevant information against which you can make an informed decision.

As your current electricity usage profile (electrical demand against time of day, week, month and year) is critical to the financial return you can expect from a solar PV installation we treat every enquiry as a unique project. Subsequently we are frequently able to recommend ways in which you can manage your electrical consumption to make better use of the electricity you are generating yourself and import less from your supplier.

Our survey report and proposal will clearly set out all of your anticipated costs and returns together with a forecast payback period and return on your investment based on current known and forecast factors together with our recommendations for your specific project. Should you subsequently have further queries we are always available to discuss these in greater detail on a personal basis.