Government Grants and Free Solar Panels

The Feed-in Tariff allows you to earn up to £8,080 over 20 years for the energy that you produce with solar panels. You may be able to get free solar panels which would mean no upfront costs for installation.

The government provide the Feed-in Tariff to ensure households with solar panels make a healthy 4.8% return on investment over 20 years.

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Grants from the government

The government does not technically offer grants for solar panels, instead it pays you for the energy you produce. This is called the Feed-in Tariff (FiT).


What is the Feed-in Tariff?

The Feed-in Tariff rewards homeowners who install solar panels. The government pays you for every kWh of energy your panels generate.

You get paid for both the energy you use (the generation tariff) and the energy you don’t use (the export tariff). Your energy bills will also drop significantly, because your panels will generate free electricity.

The money you receive is tax free and index linked. The scheme applies for 20 years and you can expect a good return on investment. Typically you can earn and save up to £8,080 over 20 years.


Did the government cut the Feed-in Tariff in 2016?

With the costs of solar panels plummeting, the government announced plans in 2015 to reduce the Feed-in Tariff by 87%.

Fortunately for homeowners, the government have backtracked, reducing the Feed-in Tariff by 64% instead. This still allows households to earn a healthy 4.8% return on investment over 20 years.


Will the Feed-in Tariff be reduced in the future?

As solar panels now make financial sense on their own without the need for any grants or funding from the government, the Feed-in Tariff will be slowly phased out.

There is now a cap on annual new spending for the Feed-in Tariff. This cap limits the amount of solar that can be registered for the Feed-in Tariff each quarter. Applications after the cap is reached will be placed in a queue for the next quarter.


How do I beat future cuts to the Feed-in Tariff?

Once you register your panels you lock in your guaranteed payments for the 20 year lifespan of the Feed-in Tariff regardless of any future cuts to the scheme.

If you are considering installing solar panels at your home, act soon to lock in the current tariff rate for this quarter.



How much can I save with the Feed-in Tariff?

The Feed-in tariff is guaranteed for 20 years. Find out below how much you could save if you installed a 4kW panel according to Energy Saving Trust figures below.


Savings Per Year

Source of Income
Savings/Earnings for installs after 15 Jan 2016
Generation Tariff
£168
Export Tariff
£79
Electricity Bill Savings
£157
Total per year
£404


Savings Over 20 Years

Solar panels are a long term investment, and you will begin to see a return after about 10 years.

While the Feed-in Tariff payments last for 20 years, your solar panels will continue to save you money on your electricity bills after the FiT payments stop.

Year
Earnings/Savings for installations after 15 Jan 2016
Profit/Loss for installations after 15 Jan 2016
One
£404
-£5,984
Five
£2,020
-£3,980
Ten
£4,040
-£1,960
Fifteen
£6,060
£60
Twenty
£8,080
£2,080


Feed-in Tariff Quarterly Rates 2016 - 2019

Quarter:

Generation Tariff for <10kW (p/kWh):
Q1 2016
4.39
Q2 2016
4.32
Q3 2016
4.25
Q4 2016
4.18
Q1 2017
4.11
Q2 2017
4.04
Q3 2017
3.97
Q4 2017
3.90
Q1 2018
3.83
Q2 2018
3.76
Q3 2018
3.69
Q4 2018
3.62
Q1 2019
3.55


Once you install your solar panels, you lock-in the Feed-in Tariff for the entire 20 years so you will not see your tariff rate reduce.

Watch a video on how the FiT works

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Can I get free solar panels?

If you want to lower your energy bills and carbon footprint but can’t afford to buy a solar panel, you can get them installed for free.

However, you will not get any of the money from the Feed-in tariff. This goes to the company who owns the solar panel. You simply get the use of the free clean energy the panel produces.

Essentially you are renting your roof space to the solar company, who will maintain and service the panel for you.


Do I qualify for free panels?

As the cost of solar has plummeted, the government has reduced the Feed-in Tariff. Cheaper solar panels have allowed many more homeowners in the UK to invest in their own solar system. However the lower FiT has resulted in less installers offering free panels.

Free solar schemes are now rare. One of the leading free solar panel providers, A Shade Greener, have stopped offering free solar panels to customers.

You will need to have a south facing roof angled between 10 and 60 degrees to stand any chance of qualifying for free solar panels.


What will I save?

This will depend on the size of the installation installed and how you use energy. If you are very energy efficient, you should be able to save about £150 a year.

It is also important to remember that it is very likely energy prices will continue to rise, so you should save more and more each year. Over 20 years the money you save should be considerable.


Are there any drawbacks?

The drawback of free solar schemes is that the installer gets to keep all the earnings from the feed in tariff. This can be as much as £404 a year.


Is it worth it?

Free solar panels will help you lower your energy bills and it is a great way to do it if you can’t afford to buy your own solar panel.

However the real money comes from investing in your own panel. Though the FiT has dropped so has the cost of solar panels, so the return on investment is still significant.


What Else Should I Consider?

If you are still paying a mortgage on your property, it is important to check with your mortgage provider before you enter into a deal with a solar panel company.

While solar panels have actually been shown to add value and attraction to homes, renting your roof could involve a contract which complicates selling it.

However, if you are planning to stay in your home for the next 20 years, this should not be a problem.

All maintenance to the panels will be free and if they somehow damage your roof this will be fixed. However, it is important to realise that if the panels cannot work properly and it is your fault, you may be asked to pay your supplier for their loss of Feed-in tariff.

It is important to shop around and discuss quotes and contracts with a few installers until you find one you are happy with.



Free solar vs. buying

With the cost of solar reducing significantly over the last few years, there has never been a better time for homeowners to buy their own solar panels.

If you can afford the upfront costs of installing solar or find a good solar financing option, you will be better off buying than opting for free solar panel schemes. Not only will you benefit from significant reductions in your energy bill, but you will also qualify for the lucrative feed-in tariff payments.

That said, if you can’t afford solar panels, free solar schemes will still help you save money.

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Free solar panels for pensioners

The good news is that there are several schemes available that offer free installation of solar panels - great news for those who don’t have a spare £5,000 sitting around, or those who would rather save their savings for other things. Pensioners who want to protect their assets for future generations and require less payback from their panels are another group of people who would benefit from the Green Deal scheme, an initiative operated by plenty of solar panel installers across the UK.

So what’s in it for the installers? They get to keep the lucrative feed-in tariff paid by the government to incentivise homeowners for generating renewable energy. What you keep as the customer, however, is the savings on your fuel bills from the word go – thought to be around £125 per year. And with fuel prices set to rise dramatically over the coming years, these savings will only increase too. And what you leave to your family years down the line is a home with a ready-integrated renewable energy system, something that’s sure to add value in an age where clean energy is only going to become more important.

Pensioners will also benefit more quickly from converting to solar energy as these are a group of people who, in theory, use more electricity through being at home more during the day when younger families are out at work and school.


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