As more and more people decide to live sustainably solar panels have increased in popularity, and installations have increased by 45% over the last 3 year (source: Gov.uk).
A growing number of homeowners are realizing the value of solar energy and are benefiting from it.
Naturally, you’ll want to know the facts – which is why we’ve outlined all the expenses involved in purchasing solar panels Peterborough, including how you’ll save over the course of a year, and the date you’ll reach a point where you’ll make a profit.
How long will it take to make a profit with your solar panels?
The time to make money on solar panels after 10.2 years, based on our most recent calculation.
The figure is based upon an apartment that gets the typical amount of sunshine in the UK and is using the average power rate of electricity, and has the highest smart export Guarantee (SEG) rates.
This relatively fast return on investment indicates that the golden age in solar energy is upon us.
The price for solar panel panels have dropped by 88% since the year 2010 according to government statistics and it’s just at the right time.
Electricity bills for households are increasing quickly, which makes it wiser to utilize solar energy that is free and, with the SEG, you’ll be paid 7.5p each kWh the solar energy that you don’t consume.
The Return on Investment explained
We’ve calculated how much of a solar array, incorporating the savings you’ll make on electricity costs from National Grid. National Grid, and added your savings from SEG.
What’s the result? Install solar panels now and you’ll make a profit in 10.2 years, based on an average.
It could take you less time to make a profit as we expect the cost of electricity to remain at a high level for in the coming two years.
Because the standard solar panel warranty is 25 years Breaking even at 10 years would give you 15 years to save more money on your panels. Many solar panels last for well over 25 years.
In terms of percentages in terms of percentages, this yield is equal no matter you have in your home. The graph clearly illustrates this that your costs remain constant and your savings increase, allowing you to reach a point of breaking even in 2032.
But, a larger investment can result in higher profits.
The typical result is profits of up to £4,759 for the solar arrays for a two or one-bedroom home, or £7,932 if the home has three bedrooms and £11,105 if you have the array for four bedrooms.
How we came up with the solution
- Based on our research we have discovered that the typical solar panel can produce a power to produce 350 kW.
- The typical 3.5 4 kWp panel costs £5,420, as per the Energy Saving Trust, so it’s obvious that a 350 kW panel will cost £542 (inclusive the installation charges).
- We also found that the typical solar panel can generate 85.25 percent of its output over the course of its life so an 3.5 kW system could deliver less than 3,000 kWh each year in the an average.
- The average household will not use the entire 3000 kWh, however, because most people aren’t in their homes all the time. The time when the government used to provide an export tax the tariff assumed that you would export 50 percent of the energy you produce and we based our calculations on the figure of 50%.
It means that you’ll consume 50% of the solar energy that you produce 1500 kWh. And the remaining 1,500 kWh will bring you cash through the Smart Export Guarantee program.
- This can reduce the amount of money in energy bills, but precisely how much will depend depending on your house.
According to Ofgem the average home that has only one or two bedrooms utilizes 1800 kWh annually, the average home with three bedrooms consumes 2,900 kWh, while a home that has four bedrooms or more consumes 4,300 kWh.
- We then multiplied these numbers by the average price of electricity in UK which averages 28.3p per unit, as per the Energy Saving Trust, to determine how much each household pays for electricity each year, and the amount they’d save through solar power.
A three-bedroom home is, for example, expected to typically be paying £844 annually for 2,900 kWh. However, with an 3.5 solar array that produces 1,492 kWh of electricity that the family uses and the homeowners will save £422 annually.
- We thought that people would opt for the highest Smart Export Guarantee rates currently available that does not require you to change suppliers or purchase an additional piece of costly hardware.
Then, we multiplied that figure which is 7.5p for each kWh which we got from Octopus by the amount of electricity that each household sends into the grid. The average house with three bedrooms in the example above, earns £111.89 annually from exporting 1,492kWh, which is half of its solar energy.
- We didn’t take into account any maintenance expenses in our calculation. If you’re able to clean your solar panels at least once a year, that’s cost-free, while the primary cost of replacing your solar inverter is dropping every day.
Inverters’ costs are expected to drop in line with the steady decline in home solar panel costs that have decreased by 50% from 2011 According to the government. The price of electricity continues to go upwards. We expect these trends to override each other.
The variables that influence the break-even point
Let’s talk about the factors that impact your investment return in solar panels.
Location
The amount of time each year that the sun shines is different throughout the United States, which you’ll be able to tell if you’ve had the majority of your time in different regions of these islands.
This directly affects the amount of energy you generate. For instance, homes located in North Scotland receive 1,080 hours of sunlight each year, while lucky ones living located in East Anglia enjoy 1,570 hours in accordance with the Met Office.
This is 45% more sunlight that’s an increase of 45% in solar energy. It’s a significant improvement.
Rate of Smart Export Guarantee
The Smart Export Guarantee compels large producers to pay their customers to purchase renewable power they sell for National Grid. National Grid.
This means that you could receive an amount of money for solar energy you do not use that’s 50%, in the average.
But, different providers offer various rates, from E Energy’s incredibly low cost of 1p per kWh up and the Octopus’s 7.5p for kWh.
You should ensure that you are on the most expensive rate as it will cost you £112 annually, on average.
Solar battery
It’s more profitable to make use of the solar energy you generate rather than sell it to pay Smart Export Guarantees – and this is the place where solar batteries can help.
A solar battery could allow you to make use of 30 percent more of your solar energy, as per E.ON.
It will save you an additional £186 each year. Solar batteries typically cost about $4500, prolonging the break-even date for the solar array for 20 years on average.
It also boosts your energy independence and lowers your CO2 emissions from greenhouse gases by an average of 18 tonnes.
Your usage of electricity
The more power your home utilizes while the sun shines the more solar energy you’ll be using and the more you’ll save on electricity via National Grid. National Grid.
But, if you don’t own a solar battery , and utilize electricity at night, you could save less each year with the solar panels.
If you’re using intelligent controls that are smart, you’ll be able ensure that appliances such as dishwasher, washing machine and electric vehicle run on solar power which is a huge lot.
The cost of electricity
It is true that buying electricity through National Grid National Grid at its current price is expensive, which is why you’ll save money through free solar energy as opposed to in the past.
Instead of having to pay £844 annually A house with three bedrooms could be paying £310 for a savings of 63 percent.
The price for National Grid electricity continues to increase, you’ll save more in the coming years.
“The Smart Export” Guarantee
The Smart Export Guarantee (SEG) began on January 1, 2020. The scheme requires all big energy companies across the UK (i.e. that have at minimum 150,000 clients) to pay consumers for the renewable energy they supply into National Grid. National Grid.
But, smaller energy providers are opting to participate also, which means that there’s a lot of competition.
There are a few energy companies that are currently offering at the very least 5.5p per one kWh of renewable power that households export into the grid.