We are all aware of the environmental impact of switching to renewable energy but there is little lucidity surrounding the economic paybacks that installing a renewable energy solution can offer the consumer. This article aims to bring clarity to the subject, whilst providing real-time figures.
Introduced in April 2010, Feed in Tariffs is a government-backed scheme that pays people who create their own electricity via renewable means such as solar PV. Feed in Tariffs are guaranteed to run for twenty five years, are retail priced indexed and completely tax free. Feed in Tariffs support a wide range of circumstances, from domestic to large scale industrial installations, guaranteeing a minimum payment for all electricity generated by the system. A further payment for the unused electricity that is exported back to the national grid, thus consumers can expect to earn back the price of their installation two or three fold in the twenty five years that the tariff runs. For example, a typical south facing, domestic 4kW solar PV installation could earn £1,380 per year from Feed in Tariffs, £50 per year from export tariffs and £220 per year reduction in their current electricity bills, earning the household total of £1650 per year.
While Feed in Tariff covers electricity generation, Renewable Heat Incentive will provide financial support for renewable heating solutions such as solar thermal, biomass boilers and ground source heat pumps. The scheme will be introduced in two stages: the first, due to launch in May 2011, will be Premium Payments for domestic installers. While the level of payment varies throughout the technologies, consumers can expect up to £950 for a wood pellet burning boiler and £300 per solar thermal unit; a substantial subsidy towards the installation of your renewable heating solution. The second phase, Renewable Heat Incentive tariffs, is due to be introduced from May 2011 to the commercial sector, and October 2012 for the domestic market. For example, a small mobile home site, providing hot water via a wood burning boiler for nine units, could receive over £1600 a year in Renewable Heat Incentive tariffs, as well as significant savings from the existing traditional heating solutions.
For more information, please contact Stove Shop Renewables, www.stoveshoprenewabless.co.uk, 01579 345018
