Have Solar Feed in Tariffs run their course?

MFW_ASAP

Given that solar PV prices have practically halved in price since FITS were first introduced, have FITS served their purpose and should they now be withdrawn?

Have panels reached the sort of price where they now have a reasonable payback period, without government assistance?

I'm wondering because I was considering going down a DIY route and doing without the FIT payments and it got me thinking whether FITS are still needed.

Ectophile

If you save the installation costs, it might make sense to DIY. For most people, who pay to have the kit installed, it still wouldn't make financial sense without the FIT.

MFW_ASAP

Ectophile wrote: »

If you save the installation costs, it might make sense to DIY. For most people, who pay to have the kit installed, it still wouldn't make financial sense without the FIT.

I've priced up my panels and ancillary products on the internet, but I have no idea of the installation costs. Are they so much higher that they would make solar economically unviable?

Do you know if there are any hard figures on solar PV payback for both DIY and professionally fitted panels?

kevin6666

There's speculation that FIT for PV will be dropped at some point in the next year but will likely remain (maybe rebranded) for other technologies. Current take up for PV FIT is remarkably consistent at the moment and currently slightly accelerating.

On the other hand ofgem or DECC rarely does anything that makes sense so who knows. After all they have to keep themselves in jobs...

jimjames

MFW_ASAP wrote: »

I've priced up my panels and ancillary products on the internet, but I have no idea of the installation costs. Are they so much higher that they would make solar economically unviable?

Do you know if there are any hard figures on solar PV payback for both DIY and professionally fitted panels?

Much easier to work out payback for FIT panels.

Our 3kWp panels cost £9k and generate in excess of 3000kWh per year. At current FIT rates that is around £1500 pa income plus any electricity savings so I estimate our payback is around 5 years.

With electricity savings alone the variation will be much higher depending how you can use generation but you'd probably be doing well to exceed £200 pa savings although the more electricity goes up in price the more you'd benefit. Payback would then depend how much you can get the equipment for but guessing £3k lowest cost that is still 15 year payback

zeupater

MFW_ASAP wrote: »

Given that solar PV prices have practically halved in price since FITS were first introduced, have FITS served their purpose and should they now be withdrawn?

Have panels reached the sort of price where they now have a reasonable payback period, without government assistance?

I'm wondering because I was considering going down a DIY route and doing without the FIT payments and it got me thinking whether FITS are still needed.

Hi

If you really think about it, the comparison is still a no-brainer. On the DIY front your materials & any sub-contract costs will attract 15% additional VAT, so the difference in cost for an MCS install is ...

(MCS net Quote+5%VAT)-(net : Equipment+Materials+SubcontractLabour+Scaffold+DNOCosts+StructuralEngineer+Certification)+20%VAT)

... When calculated, it's only the savings from the DIY route which should be offset against the FiT income, not the full cost .... For example if an installed system cost £6000 and returned a FiT payment of £600/year, whilst the DIY system cost you £5000 and was ineligible for FiT, the true saving soon becomes apparent - the £1000 extra simply pays for itself in 20 months (1000/(600/12)) ...

As said, no brainer .... but the choice, as always, is yours

HTH
Z

Martyn1981

MFW_ASAP wrote: »

I've priced up my panels and ancillary products on the internet, but I have no idea of the installation costs. Are they so much higher that they would make solar economically unviable?

Do you know if there are any hard figures on solar PV payback for both DIY and professionally fitted panels?

Hiya, probably just splitting hairs, but a non MCS (FiT qualifying) install, would still have to be 'professional'. The roofing work needs to be done well, to prevent damage and leaks, and is structurally sound. The electric side will need to be signed off so that it is accepted by the DNO when the SSEG (small scale embedded generator) is registered.

To avoid DNO involvement, you would probably have to use batteries and a separate household main for selected items (lights, fridge freezer, etc). If you did the simple thing and used a GTI (grid tied inverter) then 'the grid' will have to be told.

So your main savings would just be the MCS costs, and as Zeup mentioned, that will cost you in VAT.

Perhaps for a new build (VAT is claimed back I think?), with scaffolding already for the roof, and saving the MCS bit, might work, but I'd guess it's still close.

Also, all this is assuming a good location, roof, consumption pattern etc. So maybe a southern location, south facing roof, steep roof to reduce summer export and improve winter generation, and daytime consumption. An off south, shaded roof in Edinburgh with little to no daytime consumption won't be close.

Mart.

Martyn1981

Addendum. I did have a 'thunk' about this a while back, slightly different question and purely theoretical. See calcs in post #2

https://forums.moneysavingexpert.com/discussion/4664109

Mart.

EricMears

Martyn1981 wrote: »

Perhaps for a new build (VAT is claimed back I think?), with scaffolding already for the roof, and saving the MCS bit, might work, but I'd guess it's still close.

For a 'self-build', a supply & fix contractor would be expected to zero-rate the job. i.e. he'd not charge any vat. If the self-builder bought his/her own materials and fitted them himself (or used a non-vat-registered fitter) then paying the vat at 20% initially and reclaiming when building was completed would be the way to go. I'm not so sure about 'spec builders' though - possible that if building houses is your business you might need to add vat to final costs ?

Cardew

jimjames wrote: »

Our 3kWp panels cost £9k and generate in excess of 3000kWh per year. At current FIT rates that is around £1500 pa income plus any electricity savings so I estimate our payback is around 5 years.

In the context of this thread, the expression 'current FIT rates' needs clarification.

At current FIT rates, which was the basis of the OP's question, 3000kWh pa will generate income of around £500.

MFW_ASAP

Cardew wrote: »

In the context of this thread, the expression 'current FIT rates' needs clarification.

At current FIT rates, which was the basis of the OP's question, 3000kWh pa will generate income of around £500.

Yes, sorry if I wasn't clear. I was referring to the reduced rates that are available now that the benefit is tapering down.

Thanks for the feedback above, especially about the VAT position.