The Feed-in Tariff or ‘Clean Energy Cashback Scheme’ is a policy the government is using 
to dramatically increase the use of renewable energy. It will provide a long term financial incentive for people to invest in renewable energy systems. It was introduced in April 2010 and is guaranteed for 25 years.
Under the scheme, energy companies are required by the Government to pay a premium for electricity generated from renewable sources.
The amount you are paid will depend on when you have your system installed. The feed-in tariff rates are set for the first two years but are set to reduce year on year after that. This is to try and encourage people to get their systems installed sooner rather than later. The set amount you are paid for generating renewable electricity over the duration of the feed- in tariff will depend on when you join the scheme.
For example, if you were to join the scheme in its third year (1st April 2012 – 31st March 2013) by having a 3.96kWp system retro-fitted (on an existing property) you would be paid 37.8p (plus inflation) for every kW generated for the next 25 years from the date you sign up to the scheme.
Tariffs will be increased annually to take inflation into account. The tariff levels have been calculated to offer between 6-8% return on initial investment.
The published tariff rates for solar PV systems are as follows: 
- Year 1 & Year 2 (1st April 2010 – 31st March 2012)
- Systems up to 4kWp (retrofit): 41.3p /kW
- Systems up to 4kWp (new build) : 36.1p /kW
- Systems from 4kWp – 10kWp: 36.1p /kW
- Systems from 10kWp – 100kWp: 31.4p /kW
- Systems from 100kWp – 5MW: 29.3p /kW
- Stand alone systems (non-grid connected): 29.3p /kW
- Year 3 (1st April 2012 – 31st March 2013)
- Systems up to 4kWp (retrofit): 37.8p /kW
- Systems up to 4kWp (new build) : 36.1p /kW
- Systems from 4kWp – 10kWp: 33p /kW
- Systems from 10kWp – 100kWp: 28.7p /kW
- Systems from 100kWp – 5MW: 26.8p /kW
- Stand alone systems (non-grid connected): 26.8p /kW
The Feed-in tariff will generate income and save money in various ways:
- You get paid for all the energy that you generate (Generation tariff)
- You get an additional payment for any energy that is not consumed on site and sold back to the grid (Export tariff)
- You make a saving from not buying in the energy that has been replaced by the energy generated on site
- The income from the Feed-In Tariffs will be free of income tax for householders who install systems primarily for their own us
- Tariffs will be linked to inflation