Feed in Tariff (FiT) for business energy
Green energy is a great way to cut the cost of your gas and electricity bills. Plus, it could help to improve your business’s reputation, as your customers will value your commitment to sustainability.
You could also use green energy to make money for your business, by selling energy back to the National Grid via a feed-in tariff.
What is the Feed in Tariff (FIT)?
A Feed in Tariff (FIT) is a way to reward businesses who take some of the pressure off the National Grid by generating their own energy.
It can be as simple as having a solar panel fitted to the roof of your premises.
The government scheme that underpins FIT was launched in April 2010, as a way to boost the small-scale generation of renewable electricity. The FIT concept is one of a number of measures that have been taken to fulfil EU environmental requirements.
The beauty of the FIT scheme is that as well as saving money by generating your own electricity, you'll also get paid for the electricity you generate (a generation tariff). Plus, if you generate more than you need, you could be paid for sending that energy back into the grid (an export tariff).
On a generation tariff, you'll be paid a set rate for each kWh of electricity you generate, even if you use it yourself. The rate you’ll be paid is index linked and guaranteed for the period of the tariff (up to 20 years).
On an export tariff, you’ll also paid for any surplus electricity you transfer back to the grid. You’ll be paid a standard rate per kWh of electricity you export.
You'll also save money on your energy bill, because you'll be using your own electricity.
Could your business benefit from the Feed In Tariff?
As a first step, you’ll need to install some eligible equipment to generate renewable energy at your premises. This could be:
- Solar panels (roof mounted or stand alone)
- Wind turbines (building mounted or free standing)
- Anaerobic digesters
- Micro combined heat and power (CHP)
You’ll have to make sure your generation address is registered with and recognized by the Post Office.
The generation capacity at your premises will need to be less than 5MW.
Your installation and installer must be certified under the Microgeneration Certification Scheme (MCS). If you’re having hydro or anaerobic digestion equipment installed, this will be subject to the ROO-FIT process.
Your installer will register your premises on the central MCS database and give you a certificate of MCS compliance.
Once the equipment is commissioned for use on your premises, you’ll need to approach an energy supplier with a FIT licence so you can be officially registered on the Ofgem Central FIT Register - you’ll then be eligible to receive generation and export tariff payments.
As part of this process you should contact Business Juice to help you select the best FIT Licensee for your needs.
You’ll need to give the FIT Licensee the following information:
- Your MCS compliance certificate
- Your application form (including MCS number)
- Meter readings taken on the day you apply
- Proof that you own the generation equipment on site (such as a copy of your final paid invoice)
- Any required signed declarations
- The EPC for your premises, where required
You’ll need to have an eligibility date agreed, and for solar installations the Energy Performance Certificate (EPC) rating for your premises will need to be evaluated.
Your eligibility date will be the date your FIT Licensee receives a valid application for FIT recognition - this will more than likely be after the date when your renewable electricity system is installed. Solar installations are slightly different, in cases where these are being added to an existing system, the eligibility date will be the date of commissioning, rather than the date of any subsequent application.
Crucially, you’ll only be paid for the energy you generate from the meter reading taken on the eligibility date.
For Solar installations, you must submit your EPC with your application, and it must be dated before the commissioning date. If you don’t provide an EPC, or if the rating is below D, you’ll get a reduced tariff rate for your FIT payments.
Once all this is done, your premises will be ready to start receiving payments from your energy supplier.