How do you guys keep track of ROI on your panels / battery?

Officer_Dibble

It's impossible for most people to calculate a sensible ROI as there are too many what-ifs.

For example, if I hadn't had PV fitted, I wouldn't have got a smart meter, so I wouldn't have been on Octopus Tracker for gas since February. Does the £500 saving compared with their standard tariff count towards the ROI of the PV? If  we'd been on a more expensive tariff, perhaps we'd have put a couple of extra layers on or just shivered a bit, so what number would I actually put in? ROI only has a place before investing when putting in sensible assumptions to justify (or otherwise) the investment. Retrospectively it might be interesting, but you don't need a number to justify your decision.

paul991

Agreed then  at the time cavity wall , loft insulation and a free tank jacket were provided at little or no cost 

EcoScruples

Well it’s a best calculated figure for most, there is definitely an ROI and regardless what you would have done with the money.
great to hear a lot of quick paybacks, amazing.
The increased price of electric has certainly helped and part of why I want a half decent ROI is so I don’t have to pay for energy in my retirement where I can spend the money on stuff I want to.

1961Nick

paul991 said:

remember to subtract the interest you would of received in a savings account

For me the opportunity cost of purchasing solar has swung in favour of solar. All the FIT I receive goes straight into a savings account. The interest I lost over the period of recovering my initial capital was at best 1% pa whereas now I'm well into profit & receiving interest at 6.1% pa on that profit.

If I'd included the self consumption savings the break even for solar would have much sooner but I only started keeping accurate records when I got my first batteries. The break even point for batteries dropped quickly when electricity prices shot up, but that's now somewhat offset by the opportunity cost of higher returns on savings as I'm nowhere near break even on the capital outlay yet.

Overall it's been a good investment with over £1000 of FIT income this year (tax free) plus a forecast £1950 saving on energy. The interest on the solar profit is nearly covering the opportunity cost the remaining capital outstanding on the battery ROI.

The original costings I did for solar & batteries now look ridiculous with interest rates 8x & electricity prices 4x the figures I was using. 

QrizB

1961Nick said:

The original costings I did for solar & batteries now look ridiculous with interest rates 8x & electricity prices 4x the figures I was using. 

And we collectively need to keep that in mind when proselyting about solar PV.

"Yes you should get solar, it'll pay for itself in five years" might be true when PV is £1/watt and electricity is 30p/kWh import, 15p/kWh export. If prices go back to 15p /5p the costings are less immediately persuasive.

Anyone who installed solar before 2022 and thinks they're a moneysaving genius just because the energy market went crazy when Russia invaded Ukraine should ask themselves whether they knew that would happen when they signed their PV installation contract.

(Sorry to be a party pooper!)

paul991

Although a slightly different set  up my returns are very similar  to  Nicks

EricMears

QrizB said:

Anyone who installed solar before 2022 and thinks they're a moneysaving genius just because the energy market went crazy when Russia invaded Ukraine should ask themselves whether they knew that would happen when they signed their PV installation contract.

(Sorry to be a party pooper!)

Fitting solar panels was a 'no-brainer' in 2011.   Electricity prices seemed high and expected to get even higher.  Very easy to predict expected generation (from  PVGIS website) and first year FIT rate was predicting ROI of >10%;  with no 'running costs' and guaranteed cost of living increases that could only increase.  We were fortunate in having savings that were earning very little and more than covered cost of panels but even without them,  it would have been worthwhile to extend mortgage to cover cost.

That simple approach saw repayment of capital in seven years (even when the inevitable savings of import costs were ignored) and continuing 'profits' for next 18 years.  My only regrets have been in not having a bigger roof or one with a better slope but perhaps that's just being greedy.

Current annual FIT receipts comfortably exceed import costs.  No plans to sell house but hard to see that a prospective buyer wouldn't be impressed by negative electricity costs.

UncleK

Following my post of 12th April we've now had our kit installed for a year and I reckon payback time without taking into account potential energy price rises and/or loss of interest is about seven years. I reckon we've had a ropey summer so things should improve if anything in terms of how much we generate. But maybe if too many people do it the price they pay us plummets? I would hope we are still making electricity after seven years - lots of variables but I'm comfortable that we made the right decision - also from the non-financial point of view as well. I will keep my spreadsheet up to date!

pensionpawn

Installed Dec 2015, RoI spring this year. However I had 7.12 kWs installed and as a consequence wasn't eligible for the maximum FiT payments, which are reserved for under 4kWs installations. My RoI was based on the FiT payments and the saving on import, which my monitoring systems allowed me to measure. Simultaneously with RoI I moved to Octopus Flux so am now seeing around a 20% tax tax free return pa on my investment, which can (currently does) pay my energy bill or be invested into my pension with another 20% mark up. I'm certainly in the camp of acquiring solar panels (primarily) as a long term money saving venture, with the secondary benefit of energy security / independence when batteries become economically attractive, which also have their own RoI. A new kitchen / bathroom, in my view, doesn't have an RoI, as I paid for a new kitchen / bathroom only because the previous one was falling apart. I didn't need solar to power my house, however I chose it due to a positive financial calculation. Each to their own though..

mickyduck55

Not such a difficult calculation for us early adopters, my panels installed in 2011 so I have a generous FIT and moved to FLUX export earlier this year.  At the time of install they cost me £12k and without taking into account loss of interest and the energy self used I "think" I had recouped my capital cost year 7... maybe year 8.  I am delighted with them and unlike many on here I like the battery option as well although with FLUX the battery is probably not cost effective.