Energy and Climate Change Secretary Ed Miliband today announced the feed-in tariff (FITs) levels and also published a blueprint for a similar scheme to be introduced in April 2011 to incentivise low carbon heating technologies. The renewable heat incentive (RHI) will be a world first.

The schemes are designed to bring about a significant increase in the amount of locally produced green energy, as a contribution to the wider shift of the energy mix to low carbon.

We are pleased to confirm, following today's Pre-Budget Report, that earnings from the tariffs will be free of income tax for householders who install systems for their own energy production.

Extract from Chancellor's speech:
"From April, people with a home wind turbine or solar panels who plug their excess power into the national grid, will receive on average £900 a year.
I intend to make this payment tax free."

Extract from Pre-Budget Report:

As part of the UK Low Carbon Transition Plan the Government has announced the details of the proposed feed-in tariff for electricity generated through renewable energy systems, like solar photovoltaics.

The new tariff will pay for ALL electricity generated by your system, irrespective of if you use it yourself or sell it back to the grid. The amounts paid are in addition to any saving you will make by purchasing less electricity from your supplier and any income you earn from selling your surplus power to your electricity supplier.

The key points of the announcement are: