Martin's latest Blog

EricMears

In a recent blog announcing the ending of the FIT scheme
https://www.moneysavingexpert.com/news/2018/12/government-confirms-end-of-solar-panel-payments/?_ga=2.94199326.2056237360.1544285637-1146505341.1419417205

Martin has said "From April, it could take as many as 77 YEARS to recoup your investment".

I have to point out that that statement is just as flawed as those we see from unscrupulous installers 'guessing' that electricity prices will be increasing at 10+ percent per year for the lifetime of new panels. The 'calculation' simply shows a typical installation cost (incidentally rather more than we often see quoted in these pages) and a high & low estimate of possible annual savings. There's no allowance made for inflation so it would appear that zero inflation has been assumed.

Martyn1981

EricMears wrote: »

In a recent blog announcing the ending of the FIT scheme
https://www.moneysavingexpert.com/news/2018/12/government-confirms-end-of-solar-panel-payments/?_ga=2.94199326.2056237360.1544285637-1146505341.1419417205

Martin has said "From April, it could take as many as 77 YEARS to recoup your investment".

I have to point out that that statement is just as flawed as those we see from unscrupulous installers 'guessing' that electricity prices will be increasing at 10+ percent per year for the lifetime of new panels. The 'calculation' simply shows a typical installation cost (incidentally rather more than we often see quoted in these pages) and a high & low estimate of possible annual savings. There's no allowance made for inflation so it would appear that zero inflation has been assumed.

As the government has decided not to mandate a payment for export, we may find that the leccy suppliers decide that individually each domestic PV producer is too small to bother with. So assuming £120pa savings a £5k install might take 40yrs to pay back.

Regarding inflation, I don't see how that helps, I always write off the FiT index linking against panel degradation + cost of capital, but I assume you mean savings increase with inflation on leccy savings, but that's a bit of a mathematical rabbit hole:

Let's say you save £100 this year, then next year you save £102 because of inflation, well the £102 is worth less because of inflation, so when compared to the original investment in Yr1 £'s (the baseline), the yr2 £102 is only worth £100.

If however, energy prices rise by a higher rate of inflation than the national average, then that differential would be an extra saving.

System

I thought that I read something in the Papers last week to suggest that domestic energy exporters might have to pay additional network charges to recover the cash that has been lost because of reduced domestic energy import. Not a good time for those thinking of getting PV Solar.

Found it:

https://www.solarpowerportal.co.uk/news/solar_to_be_hardest_hit_by_ofgem_plans_for_fixed_residual_charges_and_axe_t