a policy mechanism designed to accelerate investment in renewable energy technologies by offering long-term contracts to renewable energy producers, typically based on the cost of generation of each technology. Also known as FiTs.
Pros
Allows ordinary energy users to receive a guarantee market-based payment for renewable electricity they generate and feed-in to the grid.
Cons
Price setting for FiT energy can be challenging to adjust when new information is developed.
Real Talk
FiTs have been hugely successful in increasing RE-DER deployment in foreign markets such as Germany, but must be tracked carefully by administrators and insure inclusion of all types of investors.