MSE News: Solar panel earnings to be halved from February - are they still worth it?

The Government is to slash the amount you can earn from solar panels by more than half from February 2016...
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'Solar panel earnings to be halved from February - are they still worth it?'

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  • michaels
    michaels Posts: 28,003 Forumite
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    Probably this is actually about fair - it is not impossible to get an install in the 4-4.5k price range and if it weren't for the EU import tariffs on panels this would probably be 3.5-4k givng a sensible but not spectacular rate of return.

    One thing that should be considered is varying the FIT depending on panel aspect, almost all rooftop PV is S-facing as this maximises return but this results in a glut of electricity around about midday whereas e or W facing panels only produce 10% less but provide electricity at times more useful to the grid and shoudl receive a 10% higher FIT to compensate.
    I think....
  • My panels cost £6,200 a few months ago and there is no way I would buy them now just to earn £235 a year as after 20 years I would be £1,500 down (plus all the lost interest had I invested elsewhere)! It feels like the government has killed the solar industry, and I feel sorry for all the people who will lose their jobs. So much for the Paris agreement on tackling climate change!
  • Cardew
    Cardew Posts: 29,036 Forumite
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    edited 17 December 2015 at 12:05PM
    It feels like the government has killed the solar industry, and I feel sorry for all the people who will lose their jobs.


    Much like the situation when the invention of a cheap alarm clock killed off employment for those 'knocker up' people who used to knock on the window of mill/factory workers to get them up for work.


    Ditto use of shipping containers killed off the employment of hundreds of thousands of dockers.


    6 years ago there was hardly anyone employed in the 'solar industry'. Loads of firms jumped on the gravy train to make big money fitting PV systems for the early customers who are now getting around 50pence for every kWh they generate and they don't need to export a single kWh.
  • tim_n
    tim_n Posts: 1,607 Forumite
    First Post First Anniversary Combo Breaker
    A bit different Cardew, they were well established industries replaced with more efficient ways.

    Solar hasn't begun to reach its peak, and arguably is likely to continue to become more necessary as life goes on, so we're hobbling an industry only just establishing which will likely as not leave the UK flagging behind other countries.

    Though we're increasing our subsidies of unsustainable industries.

    Seems bonkers.
    Tim
  • MFW_ASAP
    MFW_ASAP Posts: 1,458 Forumite
    Great to see this article posted on the Energy board where it belongs, rather than on the Green & Ethical board that has been ruined by a surge of solar investors. Well done MSE for listening to those of us who want the G&E board to return to Green and Ethical moneysaving instead of solar investment moneymaking. :)
  • matelodave
    matelodave Posts: 8,606 Forumite
    First Anniversary Name Dropper Photogenic First Post
    I wonder how much the cost of an installation will drop when the subsidy/FIT rates decline.


    I'm sure that a lot of companies have made a lot of money by keeping their prices high as it's been offset by the higher FIT rates.


    There always was a finite amount of money in the pot and the intention was to reduce the subsidy over time to more realistic levels.


    Don't forget that ultimately it's the rest of us who are paying for it through both our taxes as well as higher energy bills and most of us aren't not getting any benefit out of it.


    All new technologies need a bit of a kick start but in the end have to be self sustaining - if they aren't then they cannot be subsidised for ever
    Never under estimate the power of stupid people in large numbers
  • PasturesNew
    PasturesNew Posts: 70,698 Forumite
    Name Dropper Photogenic First Anniversary First Post
    I'd not have them because it'd be too complex to do the maths and understand and choose the fitters..... and, you also need to know you'll be living in the same house for quite a lot of years because [a] you want to get your money's worth having them on there will reduce your pool of potential buyers when you move as they'll become 'concerned' about what sort of system you've got etc etc.

    I'd have them fitted to, say, an extension, if the panels could provide enough oomph to heat the extension with an electric radiator (rather than having to extend the current gas one, say). But I bet that wouldn't work in reality as you'd want power when it's winter/dark, not when it's summer/light.
  • Cardew
    Cardew Posts: 29,036 Forumite
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    tim_n wrote: »
    A bit different Cardew, they were well established industries replaced with more efficient ways.

    Solar hasn't begun to reach its peak, and arguably is likely to continue to become more necessary as life goes on, so we're hobbling an industry only just establishing which will likely as not leave the UK flagging behind other countries.

    Though we're increasing our subsidies of unsustainable industries.

    Seems bonkers.


    Reached its peak?


    You could cover every field, every house and factory roof in UK with solar panels and what would happen? It doesn't generate at night when the greatest demand is placed on the national grid, so it wouldn't reduce our dependence on 'conventional' generation by oil/gas/nuclear power stations by a single Watt. We still have to spend £billions on building those facilities.


    Solar makes a lot more sense in hot countries - India/Africa/ southern states in the USA where there is more reliable output and the peak demand is during the day.


    Nothing stopping production of solar in UK, all the Government has done is reduced the subsidies, that we all pay, to a more reasonable level - albeit the subsidy is still too high.
  • System
    System Posts: 178,093 Community Admin
    Photogenic Name Dropper First Post
    edited 17 December 2015 at 5:05PM
    I wouldn't invest in PV Solar at the moment as I do not think that the sums add up. FITs are falling; installation costs are pretty static and there is no energy price inflation. The latter being the underpinning assumption used to produce inflated returns calculations for would be PV solar adopters.

    Interestingly, our US counterparts see things differently. It has just been announced:

    A five-year extension to the solar investment tax credit (ITC), which is currently included in the omnibus spending bill under consideration in Congress, would result in 25 gigawatts (GW) of additional solar capacity over the next five years -- a 54 percent increase over a no-extension scenario. According to GTM Research, which just released a preliminary updated state- and segment-level forecasts based on the current omnibus language, ITC extension will foster $40 billion in incremental investment in solar between 2016 and 2020.

    Now approved:

    http://www.bloomberg.com/news/articles/2015-12-16/solarcity-leads-solar-industry-higher-on-tax-credit-california
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