What is the primary purpose of a Feed-in Tariff (FIT)?

The primary purpose of a Feed-in Tariff (FIT) is to provide incentives for renewable energy developers. FIT programs are designed to encourage the production of renewable energy by guaranteeing a fixed payment rate for energy generated from renewable sources over a specified period. This helps to promote investment in renewable energy technologies, making it more financially viable for developers to create and operate solar, wind, biomass, and other renewable energy projects.

By offering a consistent and reliable return on investment, FITs align the financial interests of developers with environmental goals, ultimately increasing the deployment of clean energy solutions. This investment incentive is critical in achieving energy policy objectives aimed at reducing greenhouse gas emissions and fostering sustainable energy generation.