How does the feed in tariff scheme work?
The government has introduced a number of schemes to encourage homeowners to reduce their CO2 emissions by investing in renewable energy.
Here’s how the feed in tariff scheme works:
Making your own electricity enables you to make money in three ways:
First, you will earn money as the Government will pay you for all the electricity you generate. The rate is currently 21.0p per unit, index linked and tax free.
Second, you can save money by using the electricity you generate instead of having to buy it. You probably pay around 13p per unit – so that can be a substantial saving.
Thirdly, any electricity you generate but don’t use will automatically feed into the national grid – for which you’ll earn a further 3.1p per unit
The animation above gives a typical example of just how much you can earn and save. This means that an average sized solar electricity installation could be generating you £544 per year.