FITs for income

clc5

40_and_2 wrote: »

To me an initial investment of 56k generating an income of 9k a year index linked for 20 years less servicing etc lets assume 1k per year would still give me 8k x 20yrs 160k total.
Seems like a very good return and doing something which hopefully is good for the planet at the same time or am I missing something?

Hi there, I crunched some numbers to compare the return on FIT v investing a lump sum of 56K. Taking your net FIT figure of £8k per annum, assuming you invest all the FIT payments and rate of return is 3% pa after tax; and FIT payments increase by inflation of 2% per annum, then after 20 years the total investment would be worth approx £256k. The 56k lump sum invested at same 3% annual return would be worth approx £98k.

40_and_2

clc5 wrote: »

Hi there, I crunched some numbers to compare the return on FIT v investing a lump sum of 56K. Taking your net FIT figure of £8k per annum, assuming you invest all the FIT payments and rate of return is 3% pa after tax; and FIT payments increase by inflation of 2% per annum, then after 20 years the total investment would be worth approx £256k. The 56k lump sum invested at same 3% annual return would be worth approx £98k.

Cheers for that. As others have said, its not a no brainer, but, to be honest its pretty close to it if you ask me.

There are risks and will probably be "down time" for maintenance etc and I am going to pay tax on profits but even allowing for all these things it still seems like a sound idea.:o

clc5

If you're interested to know the Net Present Value of the investments ie. what they'd be worth in today's money:
FIT = approx 172K; lump sum = approx 66k.

40_and_2

clc5 wrote: »

If you're interested to know the Net Present Value of the investments ie. what they'd be worth in today's money:
FIT = approx 172K; lump sum = approx 66k.

Cheers clc5

My problem would be potentially blowing my annual FIT income and being left with nothing!! Self discipline required me thinks.

In theory though based on what I have written do you think its a sound idea?

clc5

40_and_2 wrote: »

Cheers clc5

My problem would be potentially blowing my annual FIT income and being left with nothing!! Self discipline required me thinks.

In theory though based on what I have written do you think its a sound idea?

I guess it comes down to whether you are satisfied that your estimated net return of 8k per annum is realistic taking into account the potential risk factors flagged up by other posters on this thread. I have insufficient knowledge to say whether your net return is realistic or not, but if it is then it does look like a good investment.

clc5

I dont think your original estimate of net annual income allowed for tax but you now think the profits would be taxable. I'm not sure how much this would reduce your net annual income but here are some figures for various scenarios (Net Present Value in brackets):-
Net FIT income of 8k per annum = 256k (172k) after 20 years
Net FIT income of 7k per annum = 226k (152k) after 20 years
Net FIT income of 6k per annum = 195k (131k) after 20 years
Net FIT income of 5k per annum = 165k (111k) after 20 years
Net FIT income of 4k per annum = 135k (91k) after 20 years

forgotmyname

Look at some of the coastal wind farms, We went to skegness a few weeks back and there were always
several of the generators not spinning.

Reliability is a bit suspect.

Ken68

My little town is surrounded by wind turbines, about 30 all told. Going rental rate is £8000 p.a. wide access needed for installations and maintenance. Small farmers love 'em. Can still farm under the blades.
The machines are locked in strong and weak winds, and sometimes, am told, when electricity is not needed for the grid.

[Deleted User]

40_and_2 wrote: »

freddix, wow, that was some post.

You clearly know what your talking about. As far as I can see there are 3 contenders: the proven 15 (now 35), westwind 20 and the Gaia 11.

I have read bad stuff about the proven but they appear?? to be getting the faults ironed out

The westwind seems ok but expensive and as over 15kw FITs reduced

The Gaia seems to get a lot of good press but I have been warned that my location is too windy !!

Average wind speed 6.5m/s plus and occasional storms of over 100mph

As far as I can see my site is fine clear of obstructions etc

Go on,go on, go on recommend me a turbine

Joking aside I will need to consult an accountant and find out more about 3 phase connections etc without spending a fortune. I would appreciate impartial advise as it seems to be very hard to come by.

40 & 2,

I would suggest the following:

Proven in terms of their 15kW re branded 35/32 are anything but proven at the moment. They seem to be ironing out the faults (well they should, they have been going on for more than 3 years!).

Given the history of this particular model I would walk away - they have yet to substantiate their outputs and the issues of smaller blades needs to be considered carefully.

The WestWind turbine is an interesting one - 20kW seems good, but in all but the very windiest sites the Gaia turbine beats it and I have yet to find any decent data on actual performance outputs. 6.5m/s is a good wind speed, but is still within the Gaia's range for delivering good output. If you refences the Gaia website they have a nice case study of a site in Scotland with c. 7m/s wind speed and "actual" figures of output.

BUT you are right to assess whether your wind speed is too high to make the best of the Gaia turbine which is really designed for low to medium wind speeds.

I would really do your home work and press suppliers or consultants for demonstratable data - if you have good high wind resource it is a shame to waste it, but it is even more of a shame to waste money by installing a product that isn't going to work/ or survive.

As you say the PV option doesn't make sense (later post) as you have the wind, plus in Scotland levels of solar radiation are way down compared to the South West of England and as such your performance for this technology does not stack up.

Good luck with your research!