With the aim of further encouraging and accelerating the use and investment for renewable energy technologies, many jurisdictions offer Feed in Tariff or renewable energy payments to residents who choose to utilize such environment-friendly energy resources.

This is done through offering them with long-term contracts pertaining to the electricity that they have produced as a result, as well as provide purchase prices that are based on the costs involved with the generation of such systems. This grant is open to homeowners, private investors, farmers, and business owners to encourage as many residents to find ways of utilizing renewable sources of energy.

When did the UK introduce government Feed in Tariff incentives

In the United Kingdom, these compensations for renewable energy producers and providers were first introduced on the year 2008. This was done in accordance to Britain's renewable energy quota scheme, also known as ROCS.

Under the program, a fixed sum for eligible technologies will be made to small-scale producers of electricity. The incentive is only made available to those utilizing renewable energy sources that are able to produce up to 5MW power. Rates will be determined based on the power provided, as well as the various scales utilized upon the installation of the system.

Who will pay you the Feed in Tariff money?

Terms for the contract under the program is twenty years, but for photovoltaic projects, the term is twenty-five years. The incentive will be subject to regression, meaning the rate will decrease annually for new generators. Program costs will be borne by the whole British electricity consumers. Based on this Feed in Tariff program, upon the review of the government in 2012/2013, there should be an expected reduce to the amount being paid out at about fifteen percent and is expected to reduce continuously every two years.

Here are a few distinguishing aspects of the program design of the renewable energy payment program that is being implemented by the UK. One most notable feature is that government incentive is also offered to Combined Heat and Power. Also, the program offers two distinct incentives for small solar photovoltaic system installations- one other existing homes, and on new houses.

Changes for Large Scale Solar Power generation

However, by March 2011, some changes have been introduced into the program. The government announced that it will be cutting its support for large-scale photovoltaic systems that produce greater than 50kW of electricity. The new rate of installations, which took effect on August 1 for over 50kW will now range from 19p/kWh to 8.5p/kWh to help prevent overwhelming the scheme.

As it turned out the changes were brought about by issues being raised concerning how the incentives were only being taken advantage by those private investors who are making a profit out of the compensations that they are receiving from the government. The government has stated that they do not wish for the program to be just fully soaked up by those larger scale solar projects.

According to the government, the Feed in Tariff was never designed to help provide profit to large financiers and businesses. These changes were accordingly imposed to help make sure that everybody is given a fair share of opportunity and support to help make sure that the growth of the renewable energy industry within the country will continue to progress.

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