Solar Power - always a scam??

Cardew

A_fiend_for_life wrote: »

Good Energy pays 15p per unit for all electricity generated. So you have your cake and eat it. So per unit would be the cheapest rate 10p plus the 15p feed-in tariff plus ROCs per MWh at £70. This would bring him around £885 per annum though offset compared to a savings account. Reinvesting this should give a reasonable return.

The meter readings are submitted every six months so a slight delay compared to putting it in a savings account. Not sure how long they take to credit the funds. ROCs I'm guessing are annual (though paying them at each MWh generated would be better).

I haven't read the Good energy T&Cs but I suspect that there is absolutely no guarantee that those payments(and ROCs) will be maintained. So projecting savings ahead for xx years will be an acedemic exercise.

Incidentally are you sure that you(and not Good Energy) get the money for the ROCs?

How are Good Energy funded?

dandonovon

BFG wrote: »

A neat little trick that a lot of these scammers are playing is the 'ROI' sleight of hand....

It goes like this.....

ROI stands for Return On Investment and it is similar to the interest you receive from the bank.

So if you spend £5000 on solar, and it saves you £500 a year, this is a 10% ROI.
The same £5000 in a bank or BS account will only earn you £50 interest ie a 0.5% ROI

So what you should do Mr & Mrs Potential Victim is buy the solar and get 20 YES REALLY 20 times the ROI that a bank gives you.

The calculationsare indeed correct and so it seems perfectly sensible to get 10% instead of 0.5%, but can anyone see the 'sleight'??

The "sleight" would be that you still have access to the £5000 that you put into a bank or BS account, so even if you only get your .5% ROI you still have the entire principal - whereas with the £5000 solar panel, it's just going to depreciate in value and eventually go kaput after ~20-25 years.

However, let's say you get a good panel that lasts 25 years and you take good care of it so that it produces that £500 savings every year (unlikely, but helps with the math). Over 25 years, you'll save £12500, minus the £5000 you invested the first place - so an overall savings of £7500.

Meanwhile, if you annually compound the .5% interest on your £5000, after 25 years you will have £5664.

If your panel only lasts 20 years, you'll still get back the £5000 you invested plus an additional £5000 in savings - whereas your .5% will be worth £5524.

Granted, most investments should return better than .5% - but calling this a scam seems a bit misleading.

BFG_2

dandonovon wrote: »

The "sleight" would be that you still have access to the £5000 that you put into a bank or BS account, so even if you only get your .5% ROI you still have the entire principal - whereas with the £5000 solar panel, it's just going to depreciate in value and eventually go kaput after ~20-25 years.

....If your panel only lasts 20 years, you'll still get back the £5000 you invested plus an additional £5000 in savings - whereas your .5% will be worth £5524.

Granted, most investments should return better than .5% - but calling this a scam seems a bit misleading.

Well done, got it exactly right. For the ROIs to be comparable, the solar needs to pay back savings returns PLUS 100% over the 'timescale'.

This is where I differ from you, you say [and I paraphrase] 'after 20 yrs you're better off', but to be sensible it needs to payback in the time you own the house [typically 5/7 years] since no-one will pay extra for a solar house [IMO].

So if you intend to stay in your house for 20 plus yrs...go for it!!

Sorry meant to say even the thicko Guardian journo was gullible enough to trot out the 'better return than a building society' cr4p...lol

jonesjw

BFG wrote: »

and from RICS
The cost of a greener house

Cost of cavitiy wall insulation
Cavity wall insulation £728
Energy saving per year £145
Payback period 5 years

Cost of loft insulation
Loft insulation (top up to 250mm) £755
Energy saving per year £60
Payback period 13 years

Very pessimistic figures for the insulation:

With all the grants around, cavity wall insulation can be done for about £200 & therefore payback in less than 2 years.

Wait for a Wickes BOGOF with 2 x 150mm x 6.08 M^2 for about £28 and you can top up the average 55m^2 loft insulation for £140, therefore getting payback in 2.3 years.

easytreasure

The only way you will ever save money with a solar hot water system is if you can build and install yourself. Otherwise don't bother with it. I can show you how to do it here.

and include a day to day diary of my results so far. Google UK "diy solar hot water system" or "solarfriend"

jonesjw

A_fiend_for_life wrote: »

Here's an economist / journalist case study:

http://www.guardian.co.uk/money/2009/may/09/green-your-home-solar-panels
Payback according to this one is about 10 years. I've not worked through his calculations though.

Sorry to generalise, but journalists frequently mess up the most basic maths, so I prefer to check their calculations myself.

yakky58

Hi,

I have both solar PV and solar DHW installed on my house that was done in April 2006 so I have > 3 years experience so I can put in some facts.

Electricity:
I have a 2Kwh array and generate about 2.1megawatts a year. My export is taken and paid for by SSE (Scottish and Southern) at the same rate as I pay. So the bill is basically is export per quarter is deducted from the induction. I keep careful figures for each year. Total usage over a year is 5.3megawatts so I make 2.1megawatt production is around 40% of total usage not bad.

Additionally, I am registered with Ofgem and that paid me 2x ROC for the generation which I sold to SSE for around £200 which they took off the bills. Last year the summer month bills were £15 and £12 pounds respectively. The tracking of usage is once a month read and update on the Ofgem web site.

Total cost after a 55% grant for the array was around £6000 I am sure Cardew remembers the autal figures I put in sometime last year.

Solar Water Heating
The savings are less obvious. In the summer I get lots of hot water I don't use that much. In the winter the heater is efficient in boosting the water temperature but never replaces the gas boiler. I worked out the savings on 2007 and it was about £110. On a cost of £4000 (inc of the £400 grant) the benefits are marginal. I don't see that the savings have increased in 2008. Though the company did replace for free with new ones due to a defect so I have not complaints with installers.

NB: I did a lot of the install myself to lower costs. Overall I am happy with the PV array. I'd say 40% off the electricty bill is worthwhile. I know some will argue on the initial outlay.

By the way, cleaning is snap its a ladder with standoff and then wash and wipe with a hose and sponge mop. Of course no head for heights is another matter.

Antric

People seem to miss the issue that is creeping up very fast we are running out of gas. so unless we all start making these changes. are bills will go up and up till we run out or cannot afford anymore.

also one thing people dont take into account yes the life maybe only 10 - 15 years (the same as a modern boiler)
but once all the pipes and cables (depending what solar panel you go for) are in you will not have to change that when the solar panel needs replacing there wont be as great of cost.

Cardew

yakky58 wrote: »

Hi,

I have both solar PV and solar DHW installed on my house that was done in April 2006 so I have > 3 years experience so I can put in some facts.

Electricity:
I have a 2Kwh array and generate about 2.1megawatts a year. My export is taken and paid for by SSE (Scottish and Southern) at the same rate as I pay. So the bill is basically is export per quarter is deducted from the induction. I keep careful figures for each year. Total usage over a year is 5.3megawatts so I make 2.1megawatt production is around 40% of total usage not bad.

Additionally, I am registered with Ofgem and that paid me 2x ROC for the generation which I sold to SSE for around £200 which they took off the bills. Last year the summer month bills were £15 and £12 pounds respectively. The tracking of usage is once a month read and update on the Ofgem web site.

Total cost after a 55% grant for the array was around £6000 I am sure Cardew remembers the autal figures I put in sometime last year.

Solar Water Heating
The savings are less obvious. In the summer I get lots of hot water I don't use that much. In the winter the heater is efficient in boosting the water temperature but never replaces the gas boiler. I worked out the savings on 2007 and it was about £110. On a cost of £4000 (inc of the £400 grant) the benefits are marginal. I don't see that the savings have increased in 2008. Though the company did replace for free with new ones due to a defect so I have not complaints with installers.

NB: I did a lot of the install myself to lower costs. Overall I am happy with the PV array. I'd say 40% off the electricty bill is worthwhile. I know some will argue on the initial outlay.

By the way, cleaning is snap its a ladder with standoff and then wash and wipe with a hose and sponge mop. Of course no head for heights is another matter.

yakky58 is thankfully someone with some experience of solar and keeps accurate figures - there were some interesting threads on this a couple of years ago.

I believe you stated you paid £8,500 for your system after grants(which are not as high these days).

It would appear after grants a similar new system will cost approx £12,000 to install. It really is a shame that all the promised cheaper new technology has not materialised! - Yet!

The bottom line is would you be prepared to invest £12,000 to produce approx 2,000kWh pa.( costing £200) Certainly I wouldn't! However to be fair yakky 58 makes no claim that his system will be financially viable.

The clambering on a roof to clean the panels, will be a very real difficulty for many and should not be lightly dismissed.

Solar electricity clearly will have some potential when(if) the panels get cheaper and there is legislation to curb the cowboys that the solar industry spawns.

Solar Hot Water will remain a joke in money saving terms.

ahai1

Solar energy not a scam as it can provide limited electrcity for parts of the world which do not have electricity.

http://www.thefinancialexpress-bd.com/search_index.php?page=detail_news&news_id=71056 and http://www.solar-aid.org