Government Market Stimulation

To date, the UK government has only provided grant money for renewable energy projects.

To date, the UK government has only provided grant money for renewable energy projects on a small scale; its main focus since the early 1990s has been on implementing policies designed to stimulate the market for renewable energy. The fact that large wind farms can now generate electricity at a competitive price is at least partly due to these policies.

Power companies are now obliged to generate a proportion of their electricity from renewable sources. A system of targets and fines (the Renewables Obligation and associated Renewables Obligation Scotland) has helped create a market value for renewable electricity, with companies able to buy certificates from other generators if they fail to meet their targets.

See:
http://www.saveenergy.co.uk/renewables/renewable/renewablesobligation.cfm

On the consumer side, many businesses face paying the Climate Change Levy (CCL) on their fossil energy use, with a system of levy exemption certificates to reward energy efficiency and conversion to renewable energy generation.

See:
http://www.thecarbontrust.co.uk/carbontrust/climate_change/iocc4_2_3_2.html

The detail of these schemes is complex and the rules do not apply to smaller renewable energy projects.