Free solar power system. Is it a scam?

John_Pierpoint

Cardew wrote: »

Hi John,

You should go into politics with the ability to 'fudge' figures like that!!!

Firstly, of course money in the bank, even with compounded interest, will not do much more than retain its buying power in real terms. That said it is easy to get 5% gross for safe long term investments(4% after tax) and that figure has always beaten inflation in recent years and is forecast to do so in the future - and compound interest helps as well.

If you believe that there is going to be 10% inflation on fuel prices year on year - so be it.

I am not sure of the relevance of this discussion to the 'Rent a Roof' thread; but if buying a system, surely it is best to look upon the investment as a form of annuity?

Yes we will agree to differ on our future forecasting.
My current position is that a nil rate band discretionary trust (created to prevent my grandchildren paying a 40% capital tax levy when I pop my clogs in (say) 10 - 15 years time) pays income tax at 50% (up from 40% to help service the deficit interest).

I would be delighted if you could find it a "safe" investment that pays gross interest of 5% (thus giving a net of 2.5%). Realistically the trust is lucky to get half that at the moment.

The difference between us is that you see the noughties as normality for the British economy. I am more worried that the 1970's is more realistic for our economy and that the Thatcher years were a lucky break in the long term relative economic decline. The discovery of oil after the debasement of the currency tenfold, allowed us to throw off the shackles of WW2.
So here we are living in a rich country of well educated people and modern communications with a sovereign wealth fund to act as a back up. Sorry I drifted off for a moment and woke up in Norway.

Why is it I am cursed to think like an economist, surely it is all about technical progress created by engineers:

http://www.newscientist.com/article/dn19947-we-can-feed-9-billion-people-in-2050.html

http://www.newscientist.com/article/dn19946-housing-9-billion-people-wont-take-technomagic.html

http://www.independent.co.uk/news/science/population-growth-not-a-threat-say-engineers-2182024.html

http://www.mirror.co.uk/news/top-stories/2011/01/12/global-population-explosion-could-cause-wars-and-starvation-115875-22842642/

and BBC "balance":
http://www.bbc.co.uk/news/science-environment-12160715

I do hope I am wrong and the engineers can get ahead of the curve and produce sustainable global growth, in a stable, peaceful, democratic, fair and corruption free world, but in the mean time:



You and I have always agreed on the "annuity" model: - anyone buying the panels needs to save up to maintain & then replace them at the end of their 20 - 30 year life (& renovate the roof on which they stand - the life of a well built concrete tile roof is 50 - 100 years.)

John

PS I promise to get back on thread - perhaps we need to start a new one called "Institutional and structural barriers to the introduction of sustainable energy systems in the UK" but I don't think we would get many readers and contributors.

BTW do you know any thing about the transformer in the picture?

John_Pierpoint

Zenoka wrote: »

I see that Eon have just announced that they are putting up prices by 9% :eek::eek::eek:

Increasing the price of a unit costing 11 pence by 9% a year gives a price of 95 pence in 25 years time an increase of 8 - 9 fold.

If it is any help, the price of a day time unit in 1985 was about 5 pence. when cheap North Sea oil was at last really flowing, to break the power of OPEC,

http://www.ioga.com/Special/crudeoil_Hist.htm

grahamc2003

John_Pierpoint wrote: »

Increasing the price of a unit costing 11 pence by 9% a year gives a price of 95 pence in 25 years time an increase of 8 - 9 fold.

If it is any help, the price of a day time unit in 1985 was about 5 pence. when cheap North Sea oil was at last really flowing, to break the power of OPEC,

http://www.ioga.com/Special/crudeoil_Hist.htm

If the price rises at the true rate of inflation, then, in real terms, the price is constant.

So if it's 10p today, and true inflation is x%pa over 25 years, and if that compounded up equates to say 50p (meaning bills would be five times today's level), then really nothing much has changed in reality, with the spending power of 10p equalling the spending power of 50p in 25 years time, and a £1kpa energy bill equating to a £5k energy bill in 25 years. (This was a great way of selling endowments some years ago, with focus on today's costs, with very high returns 25 years in the future, but when the future arrives, the very high returns turn out to be very low!)

Anyhow - energy prices are going to rise way above inflation to pay for all the windmills, carbon trading to keep the £multi million bonuss for city traders, fits, lagging, ro, cwi, carbon credits, new nukes, new grid infrastructure to handle windmills, and a much longer list which depresses me to type out. Imv, we are still in an era of cheap energy compared to what we have coming.

Froggitt

Plus in 25 years, the average salary will probably be £100,000 and the average house price £1m.

Cardew

This BBC Money Box is of huge importance to those contemplating ‘rent a roof’ schemes; and even those who bought their systems.

http://www.bbc.co.uk/iplayer/episode/b00y1vxr/Money_Box_29_01_2011/

Listen to introduction and again at 6mins 30 seconds.

Perhaps the most important is that many Banks and building societies will not lend/mortgage to houses with leased roofs. (I wonder if there is to be a health warning on Rent a roof brochures)

The BBC has also learnt that the Government is concerned at private companies(the rent a roof companies) are creaming off the subsidies meant for individuals. As mentioned many times on MSE, this is the ‘loophole’ that they are exploiting.

Apparently PV systems will cost £8.6Billion in subsidies and save £420 million; which all consumers – even those in flats etc on low income pay.

The Minister gave an assurance that the Government would honour existing PV subsidies, but couldn’t speak for future Governments.

keith_r59

Cardew wrote: »

This BBC Money Box is of huge importance to those contemplating ‘rent a roof’ schemes; and even those who bought their systems.

http://www.bbc.co.uk/iplayer/episode/b00y1vxr/Money_Box_29_01_2011/

Listen to introduction and again at 6mins 30 seconds.

Perhaps the most important is that many Banks and building societies will not lend/mortgage to houses with leased roofs. (I wonder if there is to be a health warning on Rent a roof brochures)

The BBC has also learnt that the Government is concerned at private companies(the rent a roof companies) are creaming off the subsidies meant for individuals. As mentioned many times on MSE, this is the ‘loophole’ that they are exploiting.

Apparently PV systems will cost £8.6Billion in subsidies and save £420 million; which all consumers – even those in flats etc on low income pay.

The Minister gave an assurance that the Government would honour existing PV subsidies, but couldn’t speak for future Governments.

It hasn't really added anything new to the debate that we didn't already know and the bit about not mortgaging houses with leased roofs came from a Moneybox listener (Sally from Cheltenham) and not from an official bank source.

Equaliser123

keith_r59 wrote: »

the bit about not mortgaging houses with leased roofs came from a Moneybox listener (Sally from Cheltenham) and not from an official bank source.

No but it makes sense as banks have always been cautious about taking security over any encumbered property - particularly one encumbered for such a long period of time with no break.

keith_r59

Equaliser123 wrote: »

No but it makes sense as banks have always been cautious about taking security over any encumbered property - particularly one encumbered for such a long period of time with no break.

The advice I would give is to speak to your bank or building society and avoid speculation.

Equaliser123

keith_r59 wrote: »

The advice I would give is to speak to your bank or building society and avoid speculation.

Yes. But it is one of the items for solicitors to provide in their report on title as being a circumstance encumbering the title.

Cardew

I suspect also it depends on the 'climate' for mortgages at any given time. When banks and Building Societies were falling over to give huge mortgages - 5 times annual income and up to 100% - it might be that having your roof rented out for 25 years would have been overlooked. These days things are different - they are looking for reasons not to lend!!

I suspect also that those with large deposits (25%-50% or so) might have less problems than those wanting a 95% mortgage.

It will be interesting to see how houses, with their roofs rented, value when on the market against those not encumbered.