My solar PV first year payback calculation

albyota

I wonder if anyone can put these figures into a spreadsheet to see if it stacks up.

If one has been using gas /oil heating at xxxx kWh and electric at xxx kWh their combined annual fuel bill will be XXX kwh.

If that same person gets rid of the gas /oil heating altogether and now uses an ASHP for heating and hot water he will use XXXX kWh of electric. But no gas / oil / fossil fuel.

If, for example, he is now using an annual total of about 10,000 kWh at 9p/kWh of electric for everything (about £900)

Fits a solar PV array (2.5 kWP) of panels producing about 2000 kWh which will reduce the annual usage down to 8000 kWh / yr (a bill of about £720) as what you generate into the grid gets deducted from your annual usage.

He can also get a LCBP grant of £2,500 towards the purchase and installation £10,000 as quoted by three companies. Balance of £7,500

On top of this, it is likely that the grid / supplier / (government backed and guaranteed for 25 years) will pay 36.5 pence per kWh unit you feed into the grid whether it is used on site or not. plus 5p per exported kWh from Scottish and Southern.
So 2000 kWh PV generated units x 36.5 pence = £730 which would wipe out your annual electric bill Per year.
So you now have a surplus of £900 (which you would have normally spent on your electric bill) to spend on a card / loan repayment of £7,500 so how long would it take to pay that off?

If he were to pay by credit card with 16 month 0% interest (Virgin card) with 3% charge is £7725 then the £85 he normally pays DD for his electric, (at the moment), it would be now be paying off the balance on the card…after 16 months (16 x £85 = £1,360) this would have reduced the balance after 16 months to £6,365, now he could either swap to another 0% card if they are still available or pay this off with a loan over 7 years at an interest rate of 7.5 % so after 8 or 9 years would he not have paid off the loan and be free of his bills? Or thereabouts.

Or does he keep paying £85, £90, £95, £100 per month over the next four or five years followed by increase after increase….£120…… £150 per month in eight or nine years time…..who knows but it aint gonna go down!
Or I could use the scrappage scheme, buy a £10,000 car watch it depreciate as soon as I drive it off the forecourt, and in five years time, sell it for £2,500 if I’m lucky!

Cardew

We have had this discussion before.

The merits of getting rid of oil and getting an ASHP are nothing what so ever to do with the pros or cons of Solar PV.

That decision, and any savings will result, will not be affected in any way by the decision to get solar PV or not.

It really is like me saying I will save £xxx a year by shopping in Lidl instead Marks and Spencer and somehow trying to introduce thos savings into the solar equation.

The decision to get solar PV or not stands on its own merits.

The problem with any spreadsheet designed to calculate 10 or 20 years ahead it is totally dependant on assumptions and 'Rubbish In - Rubbish out' applies. You need to know.

Cost of installation,

Future savings rates over the next 20 years need to be known.

Cost of Electricity over the next 20 years need to be known.

FIT rates over the next 20 years need to be known.

How much electricity will your panels generate over the next 20 years(output falls of with age)

How much of your generated electricity will you use in the property over the next 20 years.

What price will you get for suplus electricity over the next 20 years.

How much will repairs cost over the next 20 years.

Do you need to clean panels on the roof.

albyota

It would be interesting if this discussion could take part with more that just the regular fast response 'shoot you out of the sky approach' as soon as a new post goes up, lets see if others have opinions after reading the posts properly and working out the figures, not repeating the 'cleaning' obsession you have, it is not a big issue.


you would only look at solar PV for one reason....reducing your electric bills, whether you pay for the instalation up front with savings, a loan, inheritance, or a lottery win, if people want to spend their money on it, so be it, if someone wants to put an extension on their house, it is for a reason, to make more room, to save moving, they don't look at payback but know they are putting the value in to the house and may get their money back when they sell.

timmmers

OK ...I'll shoot first. NOT having any solar production facilities...just with what granny gave me, common sense.

Q How much did your energy cost you 2 years ago compared to now?
Q Did you have any control of prices?
Q Did you imagine that you would be paying this for energy now...back 2 years ago?

Q How can you even remotely consider a valid estimate of the cost savings of any alternative power source when you haven't a scoobydoo how much energy will be costing tommorrow? Basing anything on todays pricing is folly.

I have seen several people instal solar systems of both kinds, the one thing they both experienced was a rise in home value way past the value of thr kit...and AFAIK they didn't get grants.

IF I started a thread "You think energy is gettinng cheaper?" I'd be alone.
It won't and every unit saved is worth more because of that.

20 years? Look back and predict what you see every day now...you'd never come close given the chance back then . In 5 years given the public support we shall all be to some extent solar. Sensibly considering the ridiculous amount of energy wasted presently.

I saw something so bloody ridiculous today after reading this thread that I mentioned it to the party PAYING for the silliness, and got the replay "Yeah, that's daft...you should patent that!" ...someone probably already did, but people love to whine about bills...:rotfl:

Next time you visit your local. have a look what happens to the warm air the beer coolers chuck outside. ...then ask 'em what they pay for heating :rolleyes:

t

albyota

Cardew wrote: »

We have had this discussion before.

The merits of getting rid of oil and getting an ASHP are nothing what so ever to do with the pros or cons of Solar PV.

That decision, and any savings will result, will not be affected in any way by the decision to get solar PV or not.

It really is like me saying I will save £xxx a year by shopping in Lidl instead Marks and Spencer and somehow trying to introduce thos savings into the solar equation.

The decision to get solar PV or not stands on its own merits.

The problem with any spreadsheet designed to calculate 10 or 20 years ahead it is totally dependant on assumptions and 'Rubbish In - Rubbish out' applies. You need to know.

Cost of installation, about £10,000

Future savings rates over the next 20 years need to be known. almost certainly for the next 3 - 5 years it aint gonna be much is it? what 3.8% if your lucky.

Cost of Electricity over the next 20 years need to be known. aint gonna go down is it? starting year one from 13p (S+S), at possibly 4%/yr increase after 10 yrs 19p/kwh

FIT rates over the next 20 years need to be known. well how many websites do you have to check to see its gonna be 36.5p / kWh

How much electricity will your panels generate over the next 20 years why only 20 years? 40 - 50,000 kwh (output falls of with age) O.K at 80% reduction in the latter years, you will still be getting over £700 income every year off the average 3,300 kwh..but by then, panel replacement / inverter will be cheaper

How much of your generated electricity will you use in the property over the next 20 years. is this an issue if for every kWh generated you are being payed for it, whether you use it yourself or export it.
What price will you get for surplus electricity over the next 20 years. its 25 years if you are exporting its an extra 5p / kWh on top of the 36.5p

How much will repairs cost over the next 20 years. unknown, but with costs likely to come down, better technology, volume of sale etc..

Do you need to clean panels on the roof. if you do need to clean the panels twice/four times per year depending on where you live / access, clever cleaning companies will add this to their services, and again with competition probably £40 - £80/yr or DIY

Cardew

albyota wrote: »

they don't look at payback but know they are putting the value in to the house and may get their money back when they sell.

Does anyone know what happens to FITs if you sell your solar equipped house?

If you are getting the 36.5p, and sell house after x years, does the new owner get that rate, a reduced rate or does it lapse?

albyota

Apparently, as the equipment becomes a fixture, and is fed through the import/export meter, a deemed contract from the energy supplier to the dwelling, the new occupier becomes the holder of that contract, and would have to remain with that supplier, who would by law have to continue to either deduct the exported kWh from the imported (kWh used) lower bill....and pay at the 36.5p/kWh rate, or the new houseowner could change supplier if there was a better deal. failing that the houseowner could take the panels off the roof, sell them, have the meter changed and go back to standard meter purchasing all their electric from any supplier.

buildings insurance firms will ask the question if you have solar panels.
your clever cleaner company will ask you if you want them cleaned and polished, once, twice/yr etc...

Mcfi5dhc

Cardew wrote: »

The problem with any spreadsheet designed to calculate 10 or 20 years ahead it is totally dependant on assumptions and 'Rubbish In - Rubbish out' applies.

Or to put it another way - you're just going to ignore anything that anyone produces cos the blinkers are up, and therfore we cannot actually fulfil this?

Cardew wrote: »

You need to know.

Cost of installation,

Future savings rates over the next 20 years need to be known.

Cost of Electricity over the next 20 years need to be known.

FIT rates over the next 20 years need to be known.

How much electricity will your panels generate over the next 20 years(output falls of with age)

How much of your generated electricity will you use in the property over the next 20 years.

What price will you get for suplus electricity over the next 20 years.

How much will repairs cost over the next 20 years.

Do you need to clean panels on the roof.

If you actually bothered to look at the spreadsheet you'll notice that most of the above are variables which you can change for your own assumptions (we are never going to get everyone to agree on all the assumptions) - and you'll see that Solar PV has a decent payback if you use reasonable inputs .

I'm sure the sceptics will manage to somehow drag it out to 50 years or so...

dopeyfairy

Wow, that looks a lot better than I thought. 28p for exported electricity is good. Last time I looked they were all offering around 10p!

Mcfi5dhc

dopeyfairy, here is the link to southern electrics microgeneration tariffs:

http://www.southern-electric.co.uk/Help/ForYourHome/Microgeneration.aspx

Please note - I have no connection to southern electric other than I use them myself - I DO NOT work for them!