Solar Panel Funding Options

Solar panels are a great source of renewable energy that not only see you make a saving in energy bills, but could also earn you money back. The main deterrent to installing solar panels is the upfront cost, which not everyone can afford, but there are monetary incentives available to encourage property owners to switch to solar energy.

The UK Government has been promoting renewable energy for many years and have established two schemes that support residents of the UK investing in the installation of sources of renewable energy.

Four stacks of gold coins ascending in size from left to right, with a light bulb at the far end to represent the value of funding for solar panels.

The Feed-In Tariff

The feed-in tariff is a government scheme that rewards homeowners for installing solar panels. The government will pay homeowners for the energy they produce. This includes both the energy that is used by the homeowner themselves and the energy that is sold back to the grid.

The amount you get paid will vary and depend on the size of the system, the types of technology used, and when it was installed. As the payments last for 20 years, this significantly reduces the payback time of the initial investment, meaning you could actually start making money, rather than just breaking even.

Types of Tariffs

There are two types of feed-in tariffs;

Generation Tariff

A set amount of energy produced and used (depends on certain factors.)

This tariff ranges between 6.38-13.88p per kWh/h depending on the size of the system.

Export Tariff

This is excess electricity that you sell. You will get 4.77p per unit for this. You should be able to sell roughly half of the total energy you produce.

Generation Tariff
Lower Tariff (requirements not met)
<4kWh 13.88p/kWh 6.38p/kWh
>4-10kWh 12.57p/kWh 6.38p/kWh
>10-50kWh 11.71p/kWh 6.38p/kWh
Stand alone 6.38p/kWh 6.38p/kWh

Will the Feed-In Tariff Be Reduced in the Future?

The tariff has already been reduced compared to when it first started. In 2015 the government planned to cut it the tariff by 87%, but later back tracked, reducing it by 64% instead.
The general consensus is that the feed-in tariff will eventually be phased out. This is because solar panels these days make financial sense on their own, without the need for funding or grants.
There is also now a cap that limits the number of properties that can be register to use the solar scheme.

Renewable Heat Incentive for Solar Thermal Panels

The Renewable Heat Incentive, or RHI, is a payment scheme set up and run by the Government to encourage property owners to invest in heating systems which are generated by renewable energy sources. The RHI was launched in 2014 to raise the number of properties that rely on renewable technologies for heat. The Government achieves this by paying a subsidy to the property owner that chooses to install these types of heating systems.

Property Eligibility for RHI

Both domestic and non-domestic properties are eligible for the RHI however there are two separate schemes, one for domestic and one for non-domestic therefore you must ensure you have fully researched the scheme which applies to your property type.

Solar Panel Eligibility for RHI

You must have Solar Thermal Panels installed in your property in order to be eligible for the RHI. If you have Solar PV then you should look into other forms of remunerations.

Solar Thermal Panels

You may be wondering, what is the difference between Solar PV and Solar Thermal Panels? The difference is in the technology and the names indicate which technology provides which service. Solar Thermal technology collects sunlight through panels and transforms it into heat that is stored and can later be transformed into electricity. Solar PV converts directly into electricity.

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    Advantages of Solar Thermal Panels

    • Up to 70% more efficient in collecting heat from sun rays than Solar PV Panels
    • Optimum Solution for Heating Water
    • Great Value for Businesses

    Disadvantages of Solar Thermal Panels

    • Less effective in winter months when sunlight is not strong
    • Less versatile than Solar PV
    • Typically a shorter lifespan than Solar PV Panels

    Am I Eligible for RHI?

    Hand holds penny over a row of stacks of pennies, four with trees growing out of the top to represent the worth of the Renewable Heat Incentive.

    To be eligible for this reward scheme you must;

    • Live in Scotland, England or Wales
    • Own your own home
    • Be a private or social landlord
    • Be the owner of the premises (if there are multiple owners you must have permission from all)
    • The renewable system put in must be of an eligible renewable heat technology and size

    The installation of solar panels comes under the RHI scheme.

    Average Payments for RHI

    Past, Current and Future Tariffs

    Applications submitted Biomass boilers and stoves (p/kWh) Air source heat pumps (p/kWh) Ground source heat pumps (p/kWh) Solar thermal (p/kWh)
    01/04/2017-30/06/2017* 4.28p 7.63p 19.64p 20.06
    01/07/2017 – 19/09/2017 3.85p 7.63p 19.64p 20.06p
    20/09/2017-31/12/2017* 6.54p 10.18p 19.86p 20.06p
    01/01/2018 – 31/03/2018 If any new tariff changes are to be made due to digression, the announcement by BEIS would be made by 1 December 2017.

    How to Apply

    Start off with ensuring you have the following;

    • MCS Certificate Number
    • Energy Performance Certificate (EPC)
    • Personal information and bank details
    • Your metering questions (if required)


    You will then need to fill out the RHI application form and submit it to Ofgem (an energy regulator)

    Its recommended to submit the application through Ofgem because it’s free, unlike a lot of other application management services which charge a fee.

    If you, or someone you know cannot apply online then call 0300 003 0744, where you can complete the application over the phone with an advisor.

    You must apply for RHI within 12 months of the solar panels being installed. Payments can be backdated.

    Make sure you check out the RHI checklist to ensure you have all the correct information, as there are a lot of stages to the process.

    Visit to find out any additional information about grants and incentives.

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