Make your own energy to lower bills and earn cash, promises a new government scheme.
What is the Clean Energy Cashback?
The government will pay individual homes, businesses and communities for generating green electricity from renewable energy systems on their property. This includes solar panels and small hydro and wind turbines up to 5MW.
Adding solar panels to your home is one
way to try and reduce your bills.
This is known as the Clean Energy Cashback scheme (CEC) or Feed-In Tariffs (FIT).
It started on the 1st of April 2010.
Why?
The aim of the payments is to entice more people to install these clean microgenerators.
The UK gets about 5.5% of its electricity from renewable sources, ranking it a lowly 25th out of 27 EU countries. In order to hit green targets in 10 years' time, this must rise to 30%.
How to get involved
1. Decide which technology is suitable for your home using this tool on the Energy Saving Trust's website.
2. Check with your energy supplier that you would be eligible for the tariff and note any conditions. If they require your generator to have a meter, they may be able to cover the cost of buying and installing it.
3. Install the technology. You can search by area for products and installers approved by the Microgeneration Certification Scheme (MCS).
4. Once installed, notify your energy supplier.
5. You receive the Clean Energy Cashback.
There are lots of rules surrounding the CEC. For more detailed information see the Energy Saving Trust website.
Eligible technologies
You can get the CEC for installing the following small-scale technologies:
Use the Energy Saving Trust's home energy generation selector tool to help you decide which technology is suitable for your home.
Payback
Ways to save and earn
Go green and save?
- You can use the electricity you generate yourself, meaning you don't have to pay a supplier for it.
- Your electricity supplier pays you for each unit of energy you generate, whether you use it or not.
- You send any electricity you don't use back to the grid and get paid an export tariff for it.
You will get paid directly by your existing electricity supplier, but the payments will be overseen by the regulator Ofgem.
You can still import electricity from the grid when you need additional power.
Tariffs
Tariff levels vary depending on the installation and the energy company. The scheme is retrospective and installations completed between the 15th of July 2009 and the 31st of March 2012 will earn the most.
For example, a typical home installing solar panels before the end of March 2012 at an average cost of between £8,000 and £14,000, could expect to earn around £840 annually.
Generation and export tariffs will rise in line with inflation.
From 1st April 2012 the rates will decrease each year for new entrants to the scheme.
Please note that these tariffs only apply to England, Wales and Scotland. Northern Ireland has not yet taken a decision on feed-in tariffs.
Part two: disadvantages, options if you already have a microgenerator, future developments