The Solar Investment

The economic climate is currently looking rather bleak, as are the investment opportunities as a result of that, so you are probably looking at alternative ways to invest your earnings.

Well have you thought about investing in Solar Panels!

"Generate cheap, green electricity from sunlight" - Energy Saving Trust UK

Over recent times the cost of installing the average solar panel has been reduced considerably where a (2.7kWp) which is now around the cost of just £12,000. - I will be referring to this particular system throughout, with costings etc.

("But in general: the greater the amount of electricity that the system can generate, usually the more costly it will be, but it could potentially save more.")

However, there are companies out there willing to fit solar panels, free of charge.

Businesses are not only offering to install these these free solar panels for you, whilst obviously telling you what a great thing you are doing by contributing to help 'save the planet'.

But they also go on to claim that they are in fact saving you money.

Saving you up to more than than two hundred pounds worth of free electricity over the next twenty five years.

So it is a great deal, right? 

  • You are doing 'a bit more' for green energy, by averaging a reduction of a 1.2 carbon tonnes every year. 
  • The cost of the solar panels are free, with some companies even paying you to install them on to your roof.
  • You could also be possibly be saving more than £200 worth of electricity bills, as sun light is free.
  • The companies will also monitor and maintain the panels, and insure them for you.
  • You then also get the panels for free after the 25 year term is up.

Then all you have to do in return is have the right roof for the job - so obviously your roof needs adequate sunlight, which often means the roof is south facing - and isn't in the shadows.

The roof also has to be strong enough to with take the weight of the solar panels in place, and the companies won't often want to pay to re-strengthen your roof just to fit on a few solar panels- hence you could be rejected. (If you don't have the right roof - you still have options, check below).

Deal with the disruption of the panels being fitted.

Then agree to keep them for the full 25 years time period.

A great deal then.

But hang on, what's in it for them?

Businesses haven't all of a sudden become generous, they certainly aren't going to be throwing money at you for nothing!

The solar panel fitting companies are after something known as "feed in tariffs", better known as 'Fits', and this could entitle them to around twelve hundred pounds a year (it can vary depending on the size, roof type etc.) from the government.

Then they are also looking at around fifteen thousand pounds as part of their investment, then on top of this they gain the 'Fits' per unit of electricity generated (irrespective of whether you are consuming the energy or not).  

Over that twenty five years around they will be looking at an average total return of forty thousand pound per installation - certainly not a bad return for them.

So, what if you do a 'do-it-yourself job' ?

If you have the right roof, and have the spare ten to fifteen grand (or even if you have to borrow that amount) it could still definitely be a great investment for you.

Where the average calculation by the professionals state that you will pay off the costs of installation at just before the ten year mark - obviously varying from house to house (depending on how much you are paying for electricity and when you use it etc.).

The average return of the 25 year investment should be hitting around twenty thousand pounds.

So if you have a suitable roof (which a certain company specifies at around thirty square metres, south facing, and is unshaded, with an approximate thirty to forty degree slant) alongside access to a fair bit of cash - it is definitely worth looking into having panels fitted yourself.

Why it is an even better deal:

  • You are still doing 'a bit more' for green energy and saving the planet etc. 30 carbon tonnes saved in its lifetime.
  • In the long run you should be looking at a return of roughly £20,000 worth of saving  and earning (just for them 25 years).
  • Although you have to buy them, they pay for themselves within 10 years of the 25 years.
  • Investment in saving for the future - with electricity bills expected to soar up by 2020. Your solar panels could reduce those future bills by up to 50%.

However, the minor drawback - you will have to insure and maintain them (although the systems do actually require little mechanical maintenance, you basically need just need to keep them clean).

(Also it is worth baring in mind that solar panels are much more effective for saving electricity if you are using energy during the day, rather than at night - so be sure to switch on the washing machines during the day etc.)

If you plan to take the 'DIY' route - I would follow the process below:

First: Do research into current on-goings with Solar Panels - offerings of government grants and Fits etc. Look into what you are entitled to, along with some number crunching. Visit energy saving trust.

Second: Make sure your roof can do the job - and how well it can do the job (how much sun light hours does it get etc.) - get some quality quotes. Look into planning issues, most won't need permission below a certain size, but it is best just to check.

Third: Shop around for the best value solar panels (this certainly doesn't mean the cheapest) and in terms of size (maybe getting a smaller one works out at better value).

Finally: Go over the projected calculations (taking it account, how much money that you will make, and save etc.) - then this should tell you to either go ahead with it or not.

If you have decided the first deal is probably better for you - I would recommend visiting the energy saving trust UK website - and then go on to their 'Read Consumer Guidance on Free Solar PV schemes'.

Make sure you invest in energy efficient appliances - to make the energy you have gained is stored and lasts longer.

One last point to note, they don't even necessarily have to be even on the roof, people have solar power panels installed in south facing gardens, walls etc. however just be sure to have them protected from vandalism and burglary.