Clean Energy Cashback

Clean Energy Cashback
in the UK

The Clean Energy Cashback scheme will be commencing in the UK from April 2010.  It will represent a step change in the way solar photovoltaic energy (PV electricity) is deployed in the UK.

Traditional rates of return for power generated by a solar PV system have been low to non-existent, via the ROC (Renewable Obligation Certificate) programme since 2002. This will change in 2010, to closely follow the model used in a growing number of European and other Nation and Federal States. Although the first feed-in-tariff was developed in the USA in 1978, it was not until the German RESA Act in 2000 that the market really started to see growth in Solar PV on an unprecedented scale.

With the UK launching its own Feed-in-Tariff (known as the Clean Energy Cashback scheme) for PV generators this year, the market is expected to grow very significantly.

The table below shows the Feed-In Tariff (Clean Energy Cashback) as launched 1st February 2010;

This table represents the unit price paid for the total number of units Generated (G-rate) by the PV system, and to this there are further unit rates for each unit either exported (E-rate) or used on-site (A-Rate). The aggregate of these three figures gives the T-rate, against which payback periods and rates of investment return can be calculated.

Here is the full documentation as released by DECC on 1st February 2010.

 

This demonstrates that the payback from a PV system is now a viable investment.

Indeed the target of the FiT legislation is to provide a return on investment of between 5 and 8 % per annum for the duration of the 25 year feed-in-tariff agreement.

The UK government is trying to encourage the early adoption of PV systems as widely as possible, by effectively dis-incentivising waiting until next year, or thereafter. The full feed-in-tariff will be paid in the first two years, and will reduce each year thereafter by 7%, or more, annually.

Obviously, the larger the system (up to 5MW capacity), the better the return thanks to economies of scale. Our largest scheduled client can expect a return on investment of somewhere around 9% per annum, guaranteed for the warranty period of the panels themselves – 25 years. This represents a phenomenal change in fortune for owners of PV systems and those looking to fit the technology.

Try our Clean Energy Cashback Calculator to see what you could save!

 

The key points are:

• High rate of return when compared to bank and building society base rates
• Ownership of your investment – it cannot be frittered away.
• Higher home resale value and increased HIP Energy Assessment rating.
• Security of Energy Supply (when fitted with auxiliary battery storage)
• Year-on-year carbon dioxide savings

Please note that whilst Solarsense UK Ltd has taken every care to accurately portray the figures and scenarios as we see them, our information is reliant on 3rd party sources and is taken in large part from the DECC website. This information is provided in good faith for information only and we cannot accept responsibility for financial planning conducted on the basis of these figures.

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