A feed-in tariff (FIT) is a regulatory policy mechanism used by governments to accelerate the adoption of renewable energy by guaranteeing electricity producers — including households, farms, and businesses with solar panels or wind turbines — a fixed, above-market price for every unit of electricity they generate and feed back into the national grid, typically under long-term contracts of 10–25 years. FITs provide revenue certainty to renewable energy developers and investors, lowering the financing cost of green energy projects by de-risking long-term cash flows. India has historically used variations of FIT mechanisms alongside competitive tariff-based auctions for utility-scale solar and wind projects. For investors on Ventura Securities tracking India's energy transition, renewable energy companies (including solar developers, wind IPPs, and green infrastructure firms listed on NSE/BSE), and the broader ESG investing theme, feed-in tariff policies directly influence project viability, return profiles, and the investment attractiveness of renewable energy assets.
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