Feed in Tariff

It is widely accepted that the burning of fossil fuels, such as coal and oil, is not only a waste of valuable resource but is also bad for the climate. In order to reduce the use of fossil fuels the UK government has set itself a national target of generating 30% of electricity from renewable sources by 2020 and to encourage the development of renewable energy schemes it has introduced a Feed in Tariff (FiT) which supplements the price paid by the energy suppliers.  The additional revenue that the FiT provides makes many small scale schemes financially, as well as environmentally, profitable.

Providing further encouragement to go green the Scottish Government has also set a target; to have Scotland generating 100% of the electricity used in Scotland from renewable resources by 2020.

Importantly the FiT is index linked and guaranteed for 20 years. The amount of income raised by the FiT for this scheme is set at 12.48p/kW. This figure has been locked in for the Garmony Hydro scheme.

Ofgem’s fact sheet on FITs gives an overview of the Feed-In Tariff scheme.

More information about the FITs scheme is available at www.ofgem.gov.uk/fits.

Use of grants

There has always been an understanding that where the FiT is used, the project claiming the FiT cannot be in receipt of any public grant funding. However this is not always the case. Grants are permitted to be used in addition to receiving income from generating electricity through the Feed-in Tariff Scheme as long as they are not related to the purchasing and installation of generating equipment. We have been awarded a grant from Highlands and Islands Enterprise. This grant will be used towards costs associated with the share issue, plus other costs involved with the development of the scheme, not relating to the purchase or installation of generating equipment, and other costs directly related to delivering additional environmental benefit or mitigating environmental harm.

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