How PV works

Feed-In Tariffs

The feed-in tariff (FITs) system is a government legislation, designed as an incentive for domestic and non-domestic property owners to move away from conventional fossil fuels to renewable energy sources.

The Department of Energy and Climate Change (DECC) has introduced a feed-in tariff for solar installations up to 5 MW will be introduced from 1st April this year in the UK, with a minimum lifetime of 25 years.

The feed-in tariff, which will be known as the ‘clean energy cash-back scheme’, rewards households and businesses with a payment for every kWh of electricity generated by a photovoltaic installation. The incentive for solar PV is banded dependent on the size of the system, whether it is retro-fit or new build and if it is building integrated or standalone.

In addition to the tariff for generation, where electricity is exported back to the Grid users will receive a further payment of 3p per kWh.

The UK government is committed to reducing its carbon emissions through the adoption of renewable energy sources, particularly in regards to the generation of power in order to combat climate change. The Energy Act of November 2008 sets out a series of provisions in order to help the government meet its targets.

The FITs will incentivise and attract renewable investors, making solar PV an increasingly cost effective energy providing solution.

The proposed UK tariff levels for photovoltaics (PV) are shown in the table below. Tariffs will apply for 25 years.

Scale Tariff Level for new installations in period ()p/kWh)
(Tariffs will be inflated annually)
    Year 1 Year 2 Year 3  
≤4 kW (new build)   36.1 36.1 33.0  
≤4 kW (retrofit)   41.3 41.3 37.8  
>4-10 kW   36.1 36.1 33.0  
>10-100 kW   31.4 31.4 28.7  
>100 kW-5 MW   29.3 29.3 26.8  






Approx Array Size: 80m²

PV System Size: 10kWp

Estimated Annual Revenue:

- 50% Usage on Site 50% Exported to Grid: £3,536

- 100% Usuage on Site: £3,748.50



Commercial building



Approx Array Size: 800m²

PV System Size: 100kWp

Estimated Annual Revenue:

- 50% Usage on Site 50% Exported to Grid: £31,365

- 100% Usuage on Site: £33,490




Distribution centre



Approx Array Size: 40000m²

PV System Size: 5MWp

Estimated Annual Revenue:

• 50% Usage on Site 50% Exported to Grid:£1,479,000

• 100% Usuage on Site: £1,572,500





Location is London

Orientation is South

Tilt 35º

Solar irradiance 850kWh/m²/yr

Calculations assume £0.03 export tariff and cost of electricity at £0.08 per kW/h



Feed - In Tariffs

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