The Clean Energy Cashback, or Feed in Tariff scheme, is a way of getting money for generating your own electricity. In the UK there are two renewable energy tariffs - the Electricity tariff, which, unfoolishly, went live on April 1st, 2010, and the Renewable Heat Incentive which sprung to life one year later.
Feed in Tariffs put you in control of your energy.By installing renewable energy systems you do benefit, but a significant contribution is also made to environmental sustainability in the UK. The purpose of the two tariffs is to pay people a decent and guaranteed amount for the renewable energy that they are able to generate themselves. Anyone who owns a property can benefit, as well as entire communities. Even tenants are able to take part - as long as your landlord approves.
So how does it all work?
Well, you install renewable power system such as solar panels, wind turbines, or a hydro system if you have access to water. This creates electricity - most of which you’ll use up yourself. Any extra electricity you don’t use when it’s generated will automatically be exported back to the National Grid, via an existing cable which will have been installed for you.
Despite generating your own electricity you still have a contract with an electricity supplier, and it is them who pay you for the electricity you generate and use yourself. You will also get paid for the electricity that is exported back to the Grid and payment is made typically once every quarter. Under the FITs scheme, if you generate surplus energy, you get an additional 3p/KWh for the surplus electricity you generate and export, and you can negotiate a higher rate if you can. Any extra electricity you might need is automatically imported into your property in the same way you get it from the National Grid today.
Feed in tariffs were introduced to encourage the installation of renewable energy systems in properties. The Government is keen to get people to install such systems because there is a legally binding EU target of producing 15% of the UK’s energy from renewables by 2020. At the start of 2010, the UK was only producing around 2% of its energy from renewables. Ultimately, if 8% of our energy is produced at the point of consumption that means less power stations will be needed, and less oil and gas burnt for heating. The Scottish Government aims to reach a target of 500 megawatts of community and locally-owned renewable energy by 2020.
Farmers too are able make the most of the land they own and use renewables to stir up power onsite. It is common for farmers to have more land, giving them the opportunity to install more renewable systems with the potential to generate quite a lot of electricity. Producing more than they need means they can give any surplus energy back to the National Grid system. However, farmers are only allowed to generate a maximum amount of electricity per year.
The Clean Energy Cashback pays you for the energy you produce and use in your property, or sell back to the grid. You also save money by reducing the amount of energy you buy from your energy supplier. Through renewable energy tariffs, the average household is £2000 a year better off.
India too has gone down the route of feed in tariffs, incentivizing both wind and solar energy. And this is something which can only be seen as a benefit to the 1,27 billion people that live in this country.
CERC, Central Electricity Regulatory Commission, announced new regulations that launched a system of Feed in Tariffs in India in 2009. CERC’s regulations help to calculate tariffs for each technology. As a result, a number of states in India now run their own FITs scheme which came in response to the National Action Plan on Climate Change. The Action Plan calls for 5% of electricity generation in India to be from renewable sources by 2010, and to increase 1% per year for the next five years.
However, India does not have a national FIT program. CERC issues guidelines for fixing feed in tariffs. The Ministry for New and Renewable Energy (MNRE) has already introduced FITs, which it calls Generation based Incentive schemes, separately for wind and solar energy.
According to the Global Wind Energy Council’s India Wind Energy Outlook 2012, India’s electricity demand continued to rise in 2012, “despite a slowing global economy.” India’s electricity demand is expected to more than triple between 2005 and 2030. “Despite major capacity additions over recent decades, power supply struggles to keep up with demand,” which is why the enforcement of renewable energy is crucial.
Wind energy is the fastest growing renewable energy sector in India. In 2012, according to the Global Wind Energy Council, India, there was a cumulative capacity of over 18,000 MW, with wind power accounting for almost 70% of the installed capacity in the renewable energy sector.
89GW of wind power could be installed in India by 2020, up almost 18GW by the end of August 2020. This would save £131 million of CO2 every year and hopefully allow more people access to electricity. It is remarkable that in India over 40% of people have no access to modern energy services.