It is a good time to get into the idea of buying solar panels for the home.
Solar panels have gradually come down in price as manufacturers receive larger orders which reduces the cost of solar panels for end consumer.
Crucially, the government has added the Feed-in Tariff which rewards adopters of green energy with a payment connected to how much electricity they generate. Coupled with the reduced cost of electricity after the renewable electricity is all used up, and the time is right for rapid adoption of clean, renewable energy in the home.
What Will Solar Panels Cost Me?
A good installation size of 10-14 solar panels will produce approximately 3-4 kWh of electricity. This would cost about £6,500-7,500 for the equipment and the installation service.
It is also possible to qualify for free solar panels. The installer will set these up and maintain them for you, but the reason they are free is because the installer keeps all the Feed-in Tariff payments which could amount to £12,000-13,000 over a 20 year period. This removes the potential profit element from solar panel installation.
Breaking Down The Expenses & Profits From Solar Panels
When looking at the cost of buying and installing a solar energy system for a residential home, certain assumptions have to be made in order to get a ballpark idea about expenses and potential profits over time. The actual results will differ, but hopefully not too much.
As an example, a solar panel set-up with 12 productive solar panels would likely produce approximately 3kw of electricity.
To achieve this, the panels would need to be situated on a south-facing roof at an incline of 30 degrees, with no overhanging branches from trees or nearby buildings creating shade and a 0.75 constant for energy received.
With this assessment, it is likely that the installation would generate about 2,400 kWh of electricity. With enrolment in the Feed-in Tariff which currently pays 15.44p per unit, a yearly payout of £370 could be possible. Additionally, any units that went unused could be sold to the Grid at 4.5p per unit, so adding in a modest electricity resale value of £80 per year and some cost-savings by not needing to use as much energy from the Grid at night, produces a yearly saving of over £600. The Feed-in Tariff is set to run for 20 years, so the payments could easily be £12,000 or more.
Are Free Solar Panels A Good Idea?
Some solar panel installers are promoting a free solar panel offer to consumers. The idea is attractive to homeowners who lack the cash to pay for a solar panel installation directly and do not wish to take out financing.
For consumers who think they will not qualify for a home improvement loan, it is possible to receive a Green Deal loan instead which does not require a credit check to qualify for.
Free solar may seem like a good idea, but smart buyers can appreciate that they give up all the financial upside with the free deal because the installer receives most of the upside through their receipt of all the Feed-in Tariff payments over the 20 year period. The homeowner still saves money on their electricity bill, but is not paid for every unit of electricity generated.