Current PV panel prices

thescouselander

zeupater wrote: »

Hi

The energy companies do not make a loss on this. They are obliged to run the scheme by the government & finanace the FiT payments and cover their own costs for scheme administration through increased electricity prices across the board.

HTH
Z

Really? So when the energy companies buy the energy for 4 times its value who are they they selling it on to at an even higher price? If you look at the transaction in isolation the company must make a loss even if that is counteracted by income elsewhere.

Even if the energy company does manage to pass on the loss someone somewhere is paying well over the odds for the electricity generated be that the tax payer or other energy users. Either way, loss making schemes don't tend to stick around for long - market forces will remove this inefficiency in the end.

zeupater

thescouselander wrote: »

Really? So when the energy companies buy the energy for 4 times its value who are they they selling it on to at an even higher price? If you look at the transaction in isolation the company must make a loss even if that is counteracted by income elsewhere.

Even if the energy company does manage to pass on the loss someone somewhere is paying well over the odds for the electricity generated be that the tax payer or other energy users. Either way, loss making schemes don't tend to stick around for long - market forces will remove this inefficiency in the end.

Hi

There's no argument here, it's simply the way it works. The high purchase value for all renewable energy is spread across all energy sales. The high initial values, whether it's offshore energy, solar or whatever source are simply to kick-start the industries in the UK, but similar schemes exist all around the world. As the renewable energy sector matures the payment for additional capacity reduces in order to reflect efficiency based cost savings in the sector.

Regarding market forces, I don't follow this point as it's enforced by legislation within the UK as a whole, with each generator operating in the UK having carbon targets to meet which are enforced by set penalties. It's not something that a particular company can opt out of, so there is no possibility of creating a commercial or competitive advantage within the UK. I agree that schemes such as these could provide competitive advantage on an international level, however this would really be between trading blocks, not individual nations.

HTH
Z

keith_r59

thescouselander wrote: »

Then I think we agree - this is a high risk investment. Considering the risk involved I do think the potential return on investment is on the low side - there probably much better investments around.

It all depends on your personal circumstances and whether you are looking for growth or income. What is right for one person is often totally wrong for another.

thescouselander wrote: »

To some extent yes but I expect the energy companies off set the loss they make on FIT against tax so it is actually the taxpayer picking up some of the the bill here - probably the accountants find ways to off sett nearly all of the loss in fact.

The energy companies don't make a loss on FITs and the taxpayer isn't picking up the bill. As I said earlier FITs are paid out of the environmental charge component on everyone's electricity bills.

thescouselander wrote: »

True but 25 years is a long time - I wouldn't like to predict what future governments may do over that timeframe.

But you have predicted that the FITs would be removed however this seems to be based solely on your misunderstanding of how the Feed in Tariff system is funded.

Knowing that the UK is legally bound to increase renewable energy production, and that all the main political parties are in favour of investing in green industries, I can't see this happening.

thescouselander

zeupater wrote: »

Hi



Regarding market forces, I don't follow this point as it's enforced by legislation within the UK as a whole, with each generator operating in the UK having carbon targets to meet which are enforced by set penalties. It's not something that a particular company can opt out of, so there is no possibility of creating a commercial or competitive advantage within the UK. I agree that schemes such as these could provide competitive advantage on an international level, however this would really be between trading blocks, not individual nations.

HTH
Z

Yes but if you were an energy company with a requirement to generate energy from renewable means and you had a choice would you:

a) Generate the energy from a large scale wind farm at a cost per unit near the market rate

or

b) pay a load of people 4 x over the odds for the same commodity


Clearly if there was free choice the company will do whatever is most profitable. It is only because of government interference, though legislation, that option b is taken.

It doesn't take much to get legislation changed. Sooner or later someone will start lobbying to get the legislation amended.

Some people have already had a go:

http://www.guardian.co.uk/sustainable-business/blog/fits-escape-chop

zeupater

thescouselander wrote: »

Yes but if you were an energy company with a requirement to generate energy from renewable means and you had a choice would you:

a) Generate the energy from a large scale wind farm at a cost per unit near the market rate

or

b) pay a load of people 4 x over the odds for the same commodity


Clearly if there was free choice the company will do whatever is most profitable. It is only because of government interference, though legislation, that option b is taken.

It doesn't take much to get legislation changed. Sooner or later someone will start lobbying to get the legislation amended.

Some people have already had a go:

http://www.guardian.co.uk/sustainable-business/blog/fits-escape-chop

Hi

Agree, from a traditional energy generation company's viewpoint renewables both introduce more competition and reduce consumer demand, hence sales turnover .... so of course they will be lobbying government hard to protect their own positions. Wouldn't they just love to have the money spent on CC&S and maintain their own generation 'gentlemen's club' and have this luxury subsidised by the taxpayer ...... I'd be lobbying too if I were them .....

Renewables is no different to any other technology, a market needs to be created and demand satisfied by a supply chain. Once that has happened the unit cost to the supplier & therefore the unit price to the consumer will fall. The plasma TV I am currently watching cost me over £3k not that long ago, but now that the market has developed & matured the equivalent is probably priced at less than 20% of what I paid. If I and others had not purchased at such a high value the technology would have failed & been withdrawn from the market, but as it stands both myself and others have now benefited from the success of flat screen technologies & have made purchases at much lower costs ... I hope the analogy is both relevant & useful ...

HTH
Z

goldenspiral

zeupater wrote: »

Leaving everything else aside for the moment, I'd certainly be a little worried by basing the returns on 3432kWh/annum with the shading you describe, there's a possibility that the shade %age in the SAP approved calculation doesn't reflect what you've described above.

The calculations are all based on the amount of sunlight falling in Birmingham. In London we get a bit more, which would slightly compensate. The salesman also said that the Amerisolar and mini inverter combination are so much better at dealing with the shading that the effect would only be around 10% less.

zeupater wrote: »

Have you received quotations from other installers to compare the estimated generation figures with ?
HTH
Z

I did have a couple of other quotes. They were both trying to sell the less efficient and smaller Sharp and Sanyo panels linked in series and into an inverter. The salesmen didn't know enough to realise that shading would be a major factor.

One was from Anglian. His figures showed an annual return of less than £800. He started at around £20K and quickly worked his way down to £14 or 15K when I pointed out that it would take 25 years to pay back on his figures.

goldenspiral

Cardew wrote: »

...
Secondly even if it was to produce 3,432kWh that would raise £1530 pa from FIT and selling 50% of generated output.

That over 25 years is £38,270 you can estimate another £100 a year from electricity saved in the house. £2,500.

So to reach £66,500 an inflation rate has to be estimated, as has the amount of electricity used in the house. - Whilst £66k might be a reasonable assumption - it is hardly 'official'.

You're right, it's a reasonable assumption based but their method of calculating it has been officially sanctioned by the body that certifies installers. Their calculation included the assumption that RPI would continue to increase at 3% as it has for the past 25 years. I cannot remember for certain if it included an allowance for the cost of electricity rising by the same or not; perhaps it did.

Without the reasonable assumption there would be no real financial basis to do it. It would boil down to whether we think the price of electricity is going to go crazy, as petrol has. 25 years ago I could fill my car for 33p a litre, less than £20 a tank.

Cardew

goldenspiral wrote: »

Third worry: as all the panels are angled less than 30-degrees they need cleaning from time to time, especially after a dusty rainfall which we sometimes get in London. .

This point has been discussed a little on MSE.

Some owners say that cleaning is essential, others that the rain will wash them clean.

I believe that ASG, who have fitted loads of 'rent a roof' systems, believe that the rain will suffice, and their systems are mainly in the South Yorkshire area - which has a fair amount of industry.

I have some velux windows and despite living in a rural area, they still need to be cleaned - especially after this dry weather.

On the finance angle, your calculations of income do not include the interest on investing income. To compare 'like with like' surely you must invest any income/savings from the panels. e.g year one £1500 income invested @ x%.

Personally I think investing in solar PV is best treated as an annuity. You invest £14,500 in a system and draw income etc

zeupater

goldenspiral wrote: »

The calculations are all based on the amount of sunlight falling in Birmingham. In London we get a bit more, which would slightly compensate. The salesman also said that the Amerisolar and mini inverter combination are so much better at dealing with the shading that the effect would only be around 10% less.

Hi

This does not matter at all. The company quoting used the 'officially sanctioned' calculation to estimate the output from your system. The only calculation which I believe is allowed to be used for quotations is the SAP calculation, which is averaged over the whole country .... perhaps a MCS installer will confirm this.

If you have partial shading on the array during the day the use of panel specific inverters will likely provide a significant advantage, however, I would still be very wary on the claimed output. The only information we have on the shading for your particular site is what you have supplied and the only performance comparison I would have to work on is your SAP performance estimate for a shaded roof v my SAP figures for an unshaded roof. If you have full confidence in your supplier and the product, then it's your decision to ignore the reply to the question you originally asked.

Putting the array aside for the moment, regarding the roofing work you mention that will definately need to be done, I would look at the possibility of having a roofing contractor in to fix the roof, possibly even fitting roof hooks for the panels as part of the contract, then get the installer to fit the panels whilst the scaffolding is still in place ..... might save quite a few pounds & improve the payback on the system, so it's worth considering.

HTH
Z

jetski690

Am I right in saying that people who are already on the 43.3p fit tariff that it is guaranteed for the 25 years and it cant be taken away by the government at anytime ?