Feed-in Tariff (FiT)

Key takeaways

The Feed-in Tariffs scheme supported small-scale renewable generation by paying accredited generators.

The scheme closed to new applicants in 2019, but payments continue for existing installations.

The cost is funded via electricity suppliers and ultimately recovered through bills.

What is the Feed-in Tariff scheme?

The Feed-in Tariffs (FiT) scheme was introduced to encourage small-scale renewable and low-carbon electricity generation, such as solar PV.

Ofgem explains that the scheme launched in 2010 and closed to new applicants from 1 April 2019, but it still operates for existing accredited installations.

Why does FiT still matter to businesses?

Even though new installations cannot join the scheme, suppliers still make payments to existing participants.

Those ongoing costs can still form part of the wider set of policy costs recovered through electricity pricing, particularly on business tariffs where policy costs are itemised or passed through.

How might it appear on a bill or quote?

Depending on your supplier and contract structure, it may appear:

1. as part of a bundled unit rate (all-inclusive), or
2. as part of a policy-cost grouping (pass-through / third-party costs)

For quote comparisons, the practical step is simply to confirm whether policy costs are bundled or itemised.

Sources

1. Ofgem, Feed-in Tariffs scheme overview and closure to new applicants (1 April 2019)
2. Which?, explanation that FiT payments continue for existing participants and are funded via bills