The Feed-in Tariffs (FIT) scheme requires certain Licensed Electricity Suppliers to pay fixed tariffs to micro and small renewable, and micro-CHP generators for electricity generated and exported to the National Grid.
These suppliers have specific obligations under:
- Conditions 33 and 34 of the Standard Conditions of Electricity Supply Licences (“the SLCs”)
- Feed-in Tariffs Order 2012 (“the FIT Order”).
All Licensed Electricity Suppliers are required to participate in some aspects of the FIT scheme, including declaring their FIT status annually and taking part in the periodic and annual levelisation processes.
Levelisation process for all licensed electricity suppliers
All licensed electricity suppliers (regardless of their FIT participation status) are required to make payments into the Ofgem FIT Levelisation Fund. This is based on their market share of Great Britain’s electricity supply market and any FIT payments made to accredited installations under the FIT scheme. The fund is then redistributed to FIT licensees that have made more or less payments to accredited installations than they would be required to by their market share contribution.
This process occurs on a quarterly basis (known as periodic levelisation), in addition to an annual reconciliation process (annual levelisation). More information can be found in the Feed-in Tariffs: Guidance for Licensed Electricity Suppliers.
Levelisation schedules containing key deadlines and dates for both periodic and annual levelisation can be downloaded from this page.
Becoming a FIT licensee
Licensed electricity suppliers cannot offer FIT to customers unless they are confirmed to be a FIT licensee.
By 14 February of each year all Licensed Electricity Suppliers must notify Ofgem whether they will be a:
- Mandatory FIT licensee, if they have at least 250,000 domestic customers as at 31 December of the immediately preceding FIT year. These licensees are obligated to register and make FIT payments to certain eligible generators.
- Voluntary FIT licensee, if they have less than 250,000 domestic electricity customers but elect to register and make FIT payments to certain eligible generators.
- Non-FIT licensee for the FIT year starting on 1 April following the FIT notification.
The status will then apply for the duration of the relevant FIT year (1 April – 31 March) in which they enter.
Further guidance on the role of licensed electricity suppliers on the FIT scheme can be found in the Feed-in Tariffs: Guidance for Licensed Electricity Suppliers.
For any questions on the ongoing duties of suppliers on the scheme and how to become a FIT licensee, you can contact the FIT Compliance team on FITCompliance@ofgem.gov.uk.