The 3rd part of this blog regarding the policy introductions and changes in Solar PV over 10 years, from 2002 to 2012 (when the first policy MDP was launched). In this part I will try to explain what the Feed In Tariff rate is, and how it benefits you so directly.
So we begin in April 2010, The Feed In Tariff (FiT) is launched, it offers payment for energy generation over a fixed period, so as you use and generate solar energy in your home, part of that energy is being fed back into the power grid in your area, how much is being fed is calculated by the size / wattage of the Solar PV being installed and the type of Solar Panel being used (i.e. Specifications).
With electrical meter readings that are often guesstimated for the months following the initial meter reading given to your electrical supplier, then checked 6 / 12 months down the line to confirm whether the predicted electrical usage was actually being used, and if you need to pay less per month or pay more a month. Unlike this, there is no way to confirm how much solar energy you are actually feeding back into the power grid, so upon confirming the Solar PV installation you wish to use in your home, solar companies are able to determine the likely rate (FiT rate) per year that will be generated, and thus can guesstimate how much you will be giving back, which is what the government are paying you for, the long and short of it is there is no way to take a solar meter reading to re-evaluate how much you should be getting paid, keeping the rate consistent and providing you with a constant government payment each year. All that being said polices can change, the rates from the initial calculation can go up or down, but once you’ve agreed to the 20 year commitment (the lifespan of a solar panel system), regardless of the changes the government makes, your rate will remain the same, and the your initial estimated return on investment will still be secure.