13 JUL 2020

How to Protect Pensions From Transfer Claims on Feed-In Tariffs

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A solar feed-in tariff is a rate that your energy retailer pays you for excess electricity generated by the renewable power system installed in your home. These rates fluctuate in different regions, but you get feed-in tariffs only if your system generates more energy than your household uses.


Are feed-in tariffs considered as income?

Solar power systems can significantly reduce your electricity bill. However, when you use these, you would still incur electricity chargers from your energy provider. It is because your household would need to pull energy from the grid at night. In this case, your home may turn to your feed-in tariff as payment.

This tariff is not income, and it should not affect pension payments. However, if you have surplus credit from your tariff and your retailer owes you money as a result, it may put your pension payments in jeopardy. There are workarounds to this, though.


How to avoid pensions from being affected

Your energy retailer could send your surplus credit in the form of a mailed cheque. If they do this, your credit might be wrongfully classified as additional income. Some retailers could avoid this by allowing you to consider the surplus part of the payment on your next electricity bill.

Should this be unavailable as an option, you could add battery storage to your power system. Doing so would allow you to store your excess electricity for use at night or during the winter. Adding battery storage, though, is costly—add storage only if your system is generating a consistent amount of excess energy.


Claims on mis-sold solar panels

The largest hurdle to adopting more renewable energy sources for home use is mis-selling. Mis-selling of solar panels has taken place since the introduction of feed-in tariffs. At the time, providers marketed these systems using words like ‘self-funding’ and ‘free electricity.’ They said that the tariff income would match monthly refinance payments, and consumers would not need to pay anything for their energy.

This is inaccurate. Before 2015, consumer finance comprised about 70 per cent of solar panel domestic sales. At around the same time, Barclays Partner Finance, Ikano Bank, Hitachi, and other financial lenders started withdrawing from the solar panel industry. The first complaints of mis-selling started to crop up this time, and the Consumer Credit Act 1974 states that the finance lender is liable for complaints regarding mis-selling and similar acts.

In 2019 claims management companies have increased the claims against finance lenders. According to the Financial Ombudsman Service, there are presently over 2,000 complaints regarding mis-sold solar PVs. What’s more, Barclays has allocated more than £38 million to deal with claims.

Because of this solar mis-selling scandal, the government came up with the Energy Performance Validation Scheme (EPVS). The EPVS has helped set up over £50 million worth of renewable products. This situation is possible because of the scheme’s relationship with lenders such as Allium and Ikano Bank. These lenders specify that installers who want consumer financing have to be members of the EVPS. As a result, there are no claims made against the EPVS for mis-selling.



If you fear that feed-in tariffs are compromising your pension, it is best that you consult with a company specialising in mis-selling and insurance. You do not need to have your hard-earned money jeopardised because you choose to reduce your carbon footprint.

Get in touch with Consumer Reclaim for issues about mis-sold solar panels, goods, services, insurance, and more in the UK. We have partners handling consumer credit litigation, professional negligence, unfair relationship claims, and similar cases. Contact us today!

Consumer Reclaim Ltd is regulated by the Financial Conduct Authority in respect of regulated claims management activities, reference number: 835212. Registration is recorded at: https://register.fca.org.uk. Consumer Reclaim Ltd is registered in England and Wales, Company Registration number: 07223077. Information Commissioner Office number: ZA176000. VAT number: 144 4752 12