Financial Incentives

Feed-In-Tariff - Solar Photovoltaic  

Since the beginning of the Feed In Tariff scheme in 2010 the number of solar technology installations has almost doubled year on year. More than 125,000 business and homeowners have taken advantage of the scheme.

Any property with retrofit or new build solar technology installed with a capacity of up to 4KW, will currently recieve 15.44 pence p/Kwh with an export rate of 4.64 p/Kwh. This tariff will be in place until the 1st of July 13, a review of these rates will then take place. All properties with an Energy Performace Certificate below D rating currently recieve the lower tariff of 7.1 pence p/Kwh with an export tariff of 4.64 p/Kwh.  

Due to ongoing cuts to the Feed in tariff together with system prices also falling dramatically, experts are predicting high demand for solar panel technology installations over the coming months. 

Any subsequent changes to the Feed in tariff from July 2013 will not affect homeowners who currently have solar technology installed in their households.

Further information

RHI scheme & VAT

The Renewable Heat Incentive Scheme (RHI) which is also referred to as "Clean Energy Cash Back" is due to be introduced in two phases starting July 2011 subject to final confirmation by the coalition government. It will initially guarantee fixed payments for renewable instillations, followed by long term payments from October 2012.

Phase 1 (available from July 2011) - RENEWABLE HEAT INCENTIVE (RHI) Premium Payment.

This is called the "RHI Premium Payment" and has been available to Circa 40,000 householders in Great Britain since July 2011. This funding has now been extended until spring 2014. 

RHI is designed to provide financial support that encourages individuals, communities and businesses to switch from using fossil fuel for heating, to renewables such as wood fuel.

Expected payments will be

  • Solar Thermal - £300/unit
  • Air to Water Source Heat Pumps - £850/unit
  • Biomass boilers - £950/unit
  • Ground Source Heat Pumps - £1,250/unit.

 recipients of this payment will need to ensure that:

  • They have a well-insulated home based on its energy performance certificate;
  • They agree to give feedback on how the equipment performs.
  • Further guidance will be available shortly once announced.
Phase 2 (available from Spring 2014) - RENEWABLE HEAT INCENTIVE

People in receipt of the Renewable Heat Premium Payments will be able to receive long term RHI tariff support once these tariffs are introduced, as will anybody who has installed an eligible technology since 15th July 2009.

These tariff payments will work alongside other Government energy efficient schemes, such as, Green Deal. 

 

5% VAT incentive

To encourage the installation of energy saving products the Government has applied a VAT incentive. This reduces the VAT applied to residential installations (in existing buildings) to 5% on:

  • Solar thermal & PV panels
  • Ground source heat pumps
  • Insulation for walls, floor, lofts, roofs, pipes
  • Central heating and hot water system controls, timers, thermostats and thermostatic radiators
  • Fixed draught stripping around windows, doors and loft hatches
  • Wind and water turbines
  • Micro combined heat and power units
  • Wood-fuelled boilers

The 5% rate does not apply if the energy saving product is sold on a supply-only basis. Installation of these products in new buildings is zero-rated. For further information, visit www.hmrc.gov.uk.