Breaking news -FIT's ending soon than expected?

Geoff_W

What a disaster!

I'm currently in the process of getting quotes (3 already, 3 more between now and next Tuesday). If the leaked information is correct regarding the 8 December cut-off date, then it's going to be almost impossible to jump on board the gravy train. The new FiT figure of 21p/kW would be completely non-viable for me.

mardycow

My 3.9kw sysem has just been connected as of 45 mins ago so am hurridly charging things before sun disappears for the day, have made over 8p so far!! hope i can get the paperwork sorted in time for the current FIT rates,:T

Cardew

keith_r59 wrote: »

http://i1235.photobucket.com/albums/ff435/keith_r59/SolarPaybackCalculatorv2.jpg

I wasn't implying any deception, merely that your figure is well above the UK average.

Because you give a link that explains the simplistic payback method,
it doesn't mean it is appropriate to this system. In fact your link explains why it isn't generally used.

Many people will borrow the money to buy a system.

If I borrowed the £12,000 to pay for the system at, say, 20% then I would be paying £2,400 pa interest and with an income of £1000 pa I think we all agree that the system will never pay for itself.

Borrow at 5% and I pay £600pa interest and earn £1000 pa so my income is £400 a year in the first year.

So if I have the £12,000 in the building society earning 5% then if I take it out to buy a system I am losing £600 a year in interest to earn £1,000.

If you don't accept that concept, then there is no point in contiuing the discussion. Quite honestly I cannot see how anyone can discuss the economics of a PV system - payback times etc and ignore the cost of borrowing, or the loss of interest.

As for my estimate. Well there are several sophisticated calculators (referred to on MSE) that will calculate payback times based on whatever assumptions - inflation, fuel inflation, generated output etc - you wish to make. Crucially, in light of this discussion, you have to enter the interest rate your £xx,xxx savings would earn.

Even under the 43.3p FIT payback times were typically 10 to 11 years.

At the moment they still have the 43.3p/kWh in the program, but when the new rates are used it is a simple matter to get estimates.

Yut_Man

The chances of getting a system fitted by this date is in the hand of the gods. I fortunetly have just got my system fitted today, but from paying the deposit to getting the system took 3 month. The company had a few problems along the way. They say they will send the certificate in post for next week. time ticks away. some electric companies seem to have problems with time scales also. lost post etc. The time scales seem to vary from a month to in my case probably looking like 4 month. If I read this and had payed my deposit I would be trying desperatly to get the money back. If I was at the quote stage I would throw it all in the bin. The return is totally hopeless there are so many things that can go wrong that will all cost you money there is a risk. but to suggest 4% return for the next 25 years is acceptable is totally bull. you can get this return at present from a few ISA's anyway and will probably increase with zero risk/ problems etc. Thats the end of the solar market in this country unless a few people with lots of money and a full isa quota with a desire for a toy part with there money. The date set is silly. they should stick with april but make it clear what is going to happen at that date so people have more time to make there own judgement and assess the risk to them.

keith_r59

Cardew wrote: »

I wasn't implying any deception, merely that your figure is well above the UK average.

The problem with using averages is that they don't give you accurate results for an individual's own particular circumstances. It is pretty pointless using solar irradiation figures for Glasgow if you live in Eastbourne and as I said posters can input their own predicted output figures from reliable sources such as PVGIS. Personally I would avoid EST as they keep changing their minds based on who knows what as they never provide details of how they calculate anything.

Cardew wrote: »

Because you give a link that explains the simplistic payback method,it doesn't mean it is appropriate to this system. In fact your link explains why it isn't generally used.

I just included the link to show you what payback period actually means and I did not say that you have to use it in your own calculations. What is and isn't appropriate is really up to each individual to decide for their own financial circumstances which I think I explained quite clearly.

Cardew wrote: »

Many people will borrow the money to buy a system.

If I borrowed the £12,000 to pay for the system at, say, 20% then I would be paying £2,400 pa interest and with an income of £1000 pa I think we all agree that the system will never pay for itself.

Borrow at 5% and I pay £600pa interest and earn £1000 pa so my income is £400 a year in the first year.

So if I have the £12,000 in the building society earning 5% then if I take it out to buy a system I am losing £600 a year in interest to earn £1,000.

If you don't accept that concept, then there is no point in contiuing the discussion. Quite honestly I cannot see how anyone can discuss the economics of a PV system - payback times etc and ignore the cost of borrowing, or the loss of interest.

I am not aware that 'many' people are borrowing money to pay for their Solar PV systems. Maybe you can provide some factual evidence that this is the case instead of hiding behind it as a reason to inflate payback times?

Cardew wrote: »

As for my estimate. Well there are several sophisticated calculators (referred to on MSE) that will calculate payback times based on whatever assumptions - inflation, fuel inflation, generated output etc - you wish to make. Crucially, in light of this discussion, you have to enter the interest rate your £xx,xxx savings would earn.

Even under the 43.3p FIT payback times were typically 10 to 11 years.

At the moment they still have the 43.3p/kWh in the program, but when the new rates are used it is a simple matter to get estimates.

You are quite right, there are many sophisticated calculators out there on the internet. Most of them will tell you that the payback period for a 3.96 kWp system costing £13.5k (including replacement inverter) would be less than 8 years under the 43.3.p FIT for where I live.

Not many of them include the 'lost interest on your savings' variable you want to include so it would be beneficial to me and other posters if you could show how it is used to give the 20 to 25 years payback time you have claimed. Or did you just make this up?

wiimad

My system installed on 24th October took 2 weeks to install get fitted from walking into the shop with a cheque -25% deposit to the install day and got the mcs certificate via email that evening

Cardew

keith_r59 wrote: »

Not many of them include the 'lost interest on your savings' variable you want to include so it would be beneficial to me and other posters if you could show how it is used to give the 20 to 25 years payback time you have claimed. Or did you just make this up?

Did you not write this?

QUOTE=keith_59r
I'm not too sure that the EST payback figures in their report are that accurate. By my own calculations a 3.96 kWp system costing £12k would only take 11 years to payback with the FIT at 20p.

So what EST Payback figures had you in mind, when you made the above statement? Or did you just make it up about the EST payback figures.

I was challenging your 11 year payback figure and what I stated, after giving reasons why I felt your estimate was unrealistic, was:

Originally Posted by Cardew
So I would submit that a 20 to 25 year payback is not unrealistic.

That is not a calculation, but an opinion that 20 to 25 years payback is not unrealistic. Have you understood? I mean really understood?

Every sophisticated calculator I looked at asked for you to enter the interest rate, as well as inflation, fuel inflation, amount used in house etc.

I am not aware that 'many' people are borrowing money to pay for their Solar PV systems. Maybe you can provide some factual evidence that this is the case instead of hiding behind it as a reason to inflate payback times?

Can you seriously not understand the concept of paying interest or losing interest. I gave a silly estimate of 20% interest rate only to illustrate the principle - did you not appreciate the 20% was not meant to be taken literally?

If I were a standard rate tax payer and had my £12,000 invested in with the AA in a 5 year bond(MSE's best rate) I would get 3.72% after tax.

So buying a system for £12,000 would cost me £446 in lost interest in the first year.

So borrowing £12,000 @ 3.72% means I would pay £446 in interest in the first year.

Either way the £446 has to be considered in any discussion on the economics of buying a PV system to provide an income. You surely cannot be suggesting that it is only a factor if you are borrowing?

I really don't know how to make it any simpler for you to understand.

sly_dog_jonah

mardycow wrote: »

My 3.9kw sysem has just been connected as of 45 mins ago so am hurridly charging things before sun disappears for the day, have made over 8p so far!! hope i can get the paperwork sorted in time for the current FIT rates,:T

Our 3.7kWp system went live Friday last week. So far it's generated 80kWh and our import has gone down about 15%. We've had pretty good weather this week but we've only tentatively started switching our behaviour and to use the free electricity usage in the daylight hours. Working from home helps though!

You have a short window (typically 5 working days) to get your FiT application into your supplier in order for them to accept the opening reading, otherwise it will only take effect from a new reading date (and your 25 year payback would be starting then too).

If you haven't already got the forms downloaded get em ASAP, fill them out with all the support docs and then scan and email them in (if the supplier accepts this). Edf accept scanned applications to feedintariffs@edfenergy.com or you can call the green team on 0800 404 9087. I scanned a copy over to EDF on Friday as the forms that went in via Freepost on Tuesday still hadn't arrived by then, and this was the last day they would have accepted our opening meter reading. I called to confirm they got the email and all was well :beer:

If you have to post the forms, get it done recorded delivery so you have proof of the date they received the forms (this should then be the FiT start date, using the opening meter read if you got the forms in quick enough).

anselld

Statement ...
http://www.decc.gov.uk/en/content/cms/news/gb_fits/gb_fits.aspx

Consultation document ...
http://www.decc.gov.uk/en/content/cms/consultations/fits_comp_rev1/fits_comp_rev1.aspx

The key date is now the 12th Dec ( not that it will make much difference over a weekend!)

_gav_

oh well, best cancel the planned install then, two hopes of getting it completed in that timescale. Shall use the money for something else. Don't you just love politicians!