Tariffs are indexed to the Retail Price Index
Each year the set level of the generation and export tariffs will be adjusted pro-rata to the retail price index change in the previous calendar year. The Tariff administrators then publish the updated tariff levels.
When does the index-linking apply?
Aaahh! You'll be sorry you asked. All tariffs used to go up every year in April based on the RPI in the previous calendar year. But now:
After a system is installed and the tariff is set:
The tariff will index with effect from 1st April in the following year. Therefore if the system is installed in January 2013, the tariff will not be indexed until April 2014. Why?
Indexing tariffs for future installations:
This has now got mixed up with the degression mechanism. In April 2013, the non-PV tariffs are being increased in line with RPI, but the PV tariffs are not. Why?
Historical index-linking factors
The indices used so far are:
|Year beginning||RPI Index||Cumulative|
|1st April 2010||[base year]||0%|
|1st April 2011||4.8%||4.8%|
|1st April 2012||4.8%||9.8%|
|1st April 2013||3.1%||13.2%|