How can I add a solar battery and keep my feed-in-tariff

What is the feed-in tariff (FiT) and why does it matter?

Introduced in 2010, the Feed-in Tariff (FiT) was a UK government policy designed to boost small-scale renewable energy generation. Offering long-term financial incentives (20–25 years), it attracted over 869,931 registered installations since its inception, helping reduce grid reliance, lower energy bills, and support the UK’s climate goals.

The FiT’s payout system operates on two main components:

Generation Tariff: A fixed payment for each unit of electricity (kWh) your system generates, making up the largest portion of your FiT benefit. Early adopters earn between 20.42p and 71.85p per kWh, depending on when they joined. For a typical 2.5 kWp system (around 10 panels) generating 2,500 kWh yearly, this equals £510–£1,796 annually in the scheme's early years.

Export Tariff: Additional revenue for surplus electricity exported to the grid, based on two main methods:

1. Deemed Export: For installations under 30 kW, the government assumed 50% of your generation was exported, regardless of home use. At 5.07p per kWh, this adds up to £63.38 yearly for a 2.5 kWp system generating 2,500 kWh (1,250 kWh deemed exported × 5.07 p/kWh).
2. Actual Export Payments: For owners with smart meters, export payments are based on precise measurements of electricity sent back to the grid, offering fairer payouts to those with lower self-consumption.

Importantly, generation and export payments are independent from each other. That means, anyone can cancel their export tariff while keeping their generation tariff.

While FiT rates were initially highly attractive, they underwent several reductions over time. In 2019, the scheme closed to new applicants, leaving existing participants to continue benefiting from their original accreditation rates.

Here's a snapshot of how Feed-in Tariff (FiT) rates have evolved over time for solar systems up to 4 kW in the Retrofit category, with an EPC rating of A-D, qualifying for the full generation tariff. Note: These rates are not adjusted for inflation, so your earnings could be significantly higher today.

Can I add a battery without losing my feed-in tariff payments?

Yes, FiT-accredited systems can add a battery without affecting the generation tariff. This is crucial to clarify, as misinformation has caused many homeowners to miss significant savings and revenue opportunities.

Recently, interest in adding storage to existing solar systems has grown. However, unclear guidance from suppliers and regulators has caused confusion about whether this would jeopardise FiT payments.

Thankfully, OFGEM has clarified that adding a home battery typically does not affect FiT accreditation or the generation tariff, which is based on the total energy produced by your solar panels and remains unchanged.

However, adding a smart export meter can impact export tariffs. It measures the actual energy exported, replacing the 50% deemed export assumption. If your battery stores more energy for self-use, export payments may decrease. Still, since the generation tariff makes up most FiT payments, the financial benefits of a battery usually outweigh the reduction in export income.

Switching to a smart export guarantee (SEG)

Adding a battery does not affect your FiT generation payments but can impact export tariffs. You can switch to SEG while retaining FiT generation payments. SEG tariffs, like Octopus Flux, often pay higher rates for exported electricity, but require a smart export meter. To determine which SEG tariff best suits your system, check out our detailed article on the the Best SEG Tariffs in the UK.

What are the technical considerations in keeping my FiT while adding a battery

When integrating a battery into your existing Feed-in Tariff (FiT) system, there are two coupling options to consider: AC coupling and DC coupling. Importantly—and contrary to what many installers believe—both setups can allow the battery to:

• Be charged by the existing solar system and the grid,
• Support a load, and
• Maintain a connection to the grid

However, there are specific technical requirements and compliance considerations under FiT regulations. According to Ofgem's Guidance for generators published on April 23, 2024, scenarios have been outlined for both installation methods, detailing how to maintain FiT eligibility.

AC Coupling: OFGEM scenario 4.1

AC coupling offers a straightforward solution for integrating a battery into your FiT-accredited system. To meet the requirements for this setup, you will need:

• A hybrid inverter to manage both the solar PV system and the battery, and
• A bi-directional meter to measure electricity flows accurately

Advantages:

• Simplified compliance: Deemed export payments remove the need to track precise export amounts, streamlining the setup.
• Ease of integration: AC coupling can be added to an existing system without modifying the original renewable installation.

DC Coupling: OFGEM scenario 4.4

Contrary to the common misconception that FiT eligibility only works with AC coupling, DC coupling is also viable under the right conditions. To meet the requirements for this setup, you will need:

• A bi-directional meter to measure electricity flows accurately, and
• Deemed export payments to ensure compliance with FiT regulations.

Considerations:

• DC coupling requires precise metering to separate renewable generation from grid-imported electricity.
• While slightly more complex to set up than AC coupling, DC coupling remains fully compliant under Ofgem guidelines.

For both AC and DC coupling scenarios, the metering setup must:

• Accurately measure electricity generated by the renewable installation
• Ensure that exported electricity is only counted if it comes from the renewable source (not the grid-charged battery exports)

Bi-directional meters are essential if the battery charges from the grid, as they measure both input and output to ensure net export values comply with FiT regulations.

What information do I need to share with my FiT Provider?

If you are adding a battery to your existing Solar PV system under the Feed-in-Tariff, follow two key steps to stay compliant and retain your payments:

1) Notify your FiT Provider and share the following details:

• FiT accreditation number
• Battery details (capacity, AC/DC coupling)
• Installation date
• Metering setup

2) Get your battery installed from an MCS-certified installer to ensure that the system is installed to the highest standards and your FiT Provider accepts the installation.

How does adding a battery benefit owners of solar panels?

Now that we’ve clarified that adding a battery will not affect the majority of your Feed-in Tariff (FiT) payments, let’s explore why pairing your solar system with a home battery is an essential upgrade. Here are the key benefits:

1. Increased self-consumption: Without a battery, most solar systems use only 20-30% of the energy they generate, exporting the rest to the grid. A battery stores this surplus energy for later, increasing self-consumption to nearly 100%. This reduces reliance on the grid and significantly lowers bills. Consider the scenario where with FiT export rates, you're paid just 7.14 p/kWh for unused electricity. However, any energy you buy back from the grid during peak times (like the Octopus Flux evening rate of 32.9 p/kWh) costs over 4 times more. Installing the right battery ensures you keep your solar savings where they belong—at home.

2. Energy Cost Savings: Batteries allow you to use stored energy during expensive peak periods or store cheaper off-peak electricity. Advanced management software, like ours at Capture Energy, optimises this process automatically, ensuring maximum savings.
3. Grid services: Participating in grid services like flexibility markets can bring in additional income. For instance, a 10 kW system could earn approximately £500 per event. Explore how to join these markets in our latest article about local flexibility markets.
4. Backup Power: Batteries provide critical backup power during blackouts, keeping essentials like Wi-Fi, refrigerators, and lighting operational, offering peace of mind.

Building on the benefits outlined above, the figure below shows that while solar alone has a longer payback period, adding a battery shortens it by maximising the self-consumption and reducing reliance on costly grid electricity.

Conclusion

Adding a battery to your solar PV system is not only possible under the Feed-in Tariff (FiT) scheme but also an excellent way to enhance the efficiency and value of your solar setup. Both AC and DC coupling methods allow for seamless battery integration while preserving your FiT generation payments. By following the correct guidelines and ensuring accurate metering, you can retrofit a battery without risking your FiT eligibility, whether you choose to retain deemed export payments or switch to a Smart Export Guarantee (SEG) tariff.

Retrofitting a battery increases self-consumption, lowers reliance on costly grid electricity, and unlocks opportunities like grid services and backup power. It’s a smart upgrade that aligns with your energy independence and financial goals and we strongly recommend taking the next step. Answer the short survey below to receive a free, tailored quote showing your potential savings, payback period, and return on investment.