For systems up to 4 kw in size, you receive the feed in tariff of for every kw hour your solar pv system produces. This is paid to you by your electricity provider whether you use the energy in your home or not. Any energy used in your home directly from your panels will also reduce your energy bills. As a rule of thumb in a domestic situation you are likely to use around 50% of what you produce.
Any energy that you do not use in your home is exported back to the national grid. For this you receive an export tariff of 3.1p per kw hour. Your electricity company will ask for the figure on your generation meter on a quarterly basis to pay your feed in tariff and they will estimate your export tariff at 50% of the total generation. However given that electricity costs around 15p per unit from your supplier, you are better off making the best use of the solar energy that you produce within your home. Having a wireless desk top monitoring unit in your home can help you do this, when you see that your system is generating well you may choose to switch on your washing machine or dishwasher for example. In total you will receive:
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A payment from your electricity supplier for the total number of kw hours your solar pv system generates
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Savings on your electricity bill by using the energy you produce from your solar pv system within your home
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A payment from your electricity supplier for the energy you send back to the grid
The government is currently in consultation until 23rd December 2011 about the feed in tariff rate. The proposed changes at present include a cut by more than half to the feed in tariff rate on 1st April 2012, however this new rate would be applicable to new installation and those fitted on or after 12th December 2011. A consumer guide to the proposed changes produced by REAL Assurance is available by clicking here. Despite the proposed drastic drop in the feed in tariff, solar pv remains a sound investment still offering financial returns of up to 9% on a 4kw system. The feed in tariff is index linked and tax free for a 25 year period. Given the rises in inflation and electricity prices this only adds to the benefits of investing in a solar pv system. Call GD Electrical & Solar for a free, no obligation quotation.
