What is a Feed In Tariff?
Short Answer – A Feed In tariff is the payment that your electricity retailer will pay you for solar electricity that you sell to the grid.
For a more detailed answer see below.
Two Types of Feed In Tariffs.
Gross Feed In Tariff.
A Gross feed in means that your solar power system will supply all the electricity that is generated directly to the grid. This type of tariff was used in NSW and NT. Nowadays Nett Feed in Tariffs are more common. Specifically for residential and small commercial systems in Australia.
Nett Feed In Tariff.
A nett feed in means that you are paid for selling the solar power generated which is surplus to your needs. As an example you may have a self consumption rate of 70% and you feed in 30%. This is also commonly know as nett metering.
Frequently asked Feed in Questions.
What Feed In Rate will I get?
Electricity companies use the feed in tariff rate as a promotion or customer acquisition strategy. A company may offer a high feed in rate. However, they will also charge a premium for the grid electricity that you buy. Typically we see the feed in rate to be around 1/3 of what you are paying for electricity from the grid.
Can I profit from my feed in tariff?
As a general rule the simple answer is no. There is a maximum system size allowed on nearly all electricity grids. In South Australia for example the maximum inverter size is 5kW per phase. So a standard single phase home would at maximum make around $3 per day. if there was no electricity consumption at the home at all. whilst the investment return seems inviting. It is capped at around $1000 per annum.