Solar Panel Information & Frequently Asked Questions

 

 

What Is Solar PV?
A Solar PV (Photovoltaic) System is a system which converts sunlight directly into electricity, with ‘photo’ meaning light and ‘voltaic’ electricity. A Solar PV System consists of multiple components, including photovoltaic modules, mechanical and electrical connections / mountings and mean of regulating and/or modifying electrical output.

Solar PV cells are panels you can attach to your roof or walls. Each cell is made from one or two layers of semi-conducting material, usually silicon. When light shines on the cell it creates an electric field across the layers. The stronger the sunshine, the more electricity is produced.

Solar PV Installations
In order to benefit from the maximum amount of sunlight available, Solar PV panels need to be positioned in a southerly aspect (south west through to south east). For a roof sited Solar PV System, a mounting system is attached to the existing roof on top of the roof, where the clamps used are dependent on the roofing material i.e. tiles, slate, cladding etc.
The direction of which a Solar PV system faces, affects its performance. In the United Kingdom, the sun is always in the southern half of the sky but is higher in the summer and lower in the winter. Usually, the best location for a Solar PV System is a south-facing roof, but roofs that face east or west may also be acceptable.

Feed In Tariff
A Feed in Tariff for energy produced by a Solar PV System will be paid for by energy companies, whether it is consumed at the property or exported back to the grid. This came in to effect in April 2010.

Who can claim the tariffs?
Anyone in England, Scotland or Wales who installs a Solar PV Solar System is eligible to claim the tariff which produces less than 4MW of power.

How do I claim the tariffs?
To benefit from the Feed-in Tariffs you are required to use an approved MCS installer. The Solar PV System provider will act as your agent and handle the necessary paper work and certification which is required to claim the tariff on your behalf.

 

How much will I receive from the tariffs?
Less 4kw Retro-fit 21p per Kilowatt hour.

 

- The starting rate will last for 25 years.
- The rates are set to rise with inflation annually.
- Feed in tariff income is tax free.
- An additional tariff from 3p per KW will be paid for energy fed into the grid.
- Solar PV installation benefit from a reduced VAT rate of 5%.

 

The Feed-In Tariffs therefore give you three separate financial benefits:

 

1. A generation tariff payment, which is based on the total electricity generated and the energy type

 

2. An export tariff payment, which is for any energy exports made when generating more than you use

 

3. Lower bills from your supplier for the electricity you import from them

 

What energy is the generation tariff paid on?
The generation tariff is the main payment of the Feed-In Tariffs and is paid on the total output of the renewable energy system - whether you feed it into the grid or use it yourself.

 

Yes, you actually get paid for the energy you use!

 

Many people don't realise this because the name "Feed-In Tariffs" suggests the tariffs only apply to what you feed in to the grid. The name was originally applied to the system in Germany, because the tariff was originally paid on that basis. Things have now evolved, but the name hasn't caught up. * The only exception to this rule is that tariffs are not paid if the energy is wasted just trying to get a tariff payment.

What is the export tariff?
It is a bonus payment for every kilowatt-hour (kWh) of surplus electricity your system exports to the electricity grid.
When this payment is received you are effectively selling that electricity to the energy supply company, who can then deliver it to other customers.

This payment has been established to provide an incentive for energy efficiency as you will get paid extra for every kWh you don't use but export instead.

How much is the export tariff?
A 'floor price' has been set in the legislation. For the year from 1st April 2011 this is 3.1p/kWhr. It is index-linked to the retail price index (having started at 3p/kWh when the scheme was introduced.

You are entitled to receive this or you also have the opportunity to opt out of this fixed price and try to negotiate a better rate with your electricity supplier. You have the opportunity each year to decide whether to accept the floor price or to opt out.

Unlike the generation tariff, this element will be the same whatever type of renewable energy is used.

How are the exports measured?
All the power flows relating to the tariffs will in due course be metered.

However, in the initial years before Smart Meters are widely used, the export element will be deemed to be 50% of the power generated by the system.

Those generating electricity who believe their exports are substantially higher than this will be allowed to install suitable export meters and be paid on the metered level of exports.

Who pays my tariffs to me?
Although the FITs are established in law, rather than coming from the government, the tariffs are actually paid by the energy suppliers.

Where does the money come from?

It comes out of the pockets of the supply companies because they are really nice guys! No seriously... The suppliers pass on the cost of the Feed-In Tariffs scheme to all their electricity customers. ... so the bottom line is that people who don't install renewable energy systems pay for those who do!

Might that be unfair on the electricity supply companies?
The scheme includes a fairly complex levelisation process so that the overall costs are spread uniformly across all companies.
They can even charge for the costs of administering the scheme.

 

There are also exemptions whereby small electricity suppliers can opt out and refuse to accept tariff customers in certain cases.

When and how are payments made?
If you use the same company that supplies your electricity to pay your Feed-In Tariffs, they should hopefully do both at the same time. They may even choose to 'net these amounts off' and just pay a cheque or submit a bill for the difference.

You can also appoint an agent to collect your tariffs for you. This is especially useful if you hire a third party company to oversee the installation and management of your renewable energy systems.

How long are the tariffs paid for?
The tariffs last 25 years for Solar PV Systems

Is the tariff fixed for this whole period?
Yes - once you start at a given tariff, it is guaranteed for the full period shown above and is index linked.

How does the index-linking work?
Each year the set level of the generation and export tariffs will be adjusted pro-rata to the retail price index. The Tariff administrators will publish the updated tariff levels.

Do the tariff levels ever change?
For those who are already registered, tariffs will only change in accordance with the index-linking described above
For future entrants who are not yet registered, tariff levels might change:

When the scheme is reviewed (every five years, but the first one to take effect in 2013), or Subject to the principle of degression