Does domestic solar make financial sense?

I have just sold my home with a 2.12kWp array that generates an annual income/savings of c.£1000 a year. Despite getting a raft of (often daft) questions from the buyer’s solicitor, I am convinced that the income/savings from my array was a factor in my sale.

I am now struggling with the advantages/disadvantages of getting PV solar installed at our new home. There is an unobscured roof space for a 4kWp array but, even with an install cost at the lower end of the range, I cannot seem to make the sums add up given the falling level of FIT payments. I guess that I am not alone in thinking that, until battery storage becomes more affordable, solar PV is a life choice rather than a sensible financial decision. I don’t really want to get quotes unless I am minded to take the installation forward. Am I missing something?
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  • Crowmann
    Crowmann Posts: 136 Forumite
    Hole in one.

    Your old house was to me and most others highly attractive with its £1k contribution from PV.

    Doing the same now - not a chance.
    16 265w panels South facing, 45 degrees, West Norfolk.
  • My installer came round to sort my inverter issue out yesterday. I paid £5,600 for my system 3 years ago. He reckons the same system now would be between £3,500 and £4,500 at todays prices. Not sure how long it would take you to recover that.

    I am just over 1/2 way to recover my costs in 3 years.
  • Martyn1981
    Martyn1981 Posts: 14,731 Forumite
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    Hengus wrote: »
    I have just sold my home with a 2.12kWp array that generates an annual income/savings of c.£1000 a year. Despite getting a raft of (often daft) questions from the buyer’s solicitor, I am convinced that the income/savings from my array was a factor in my sale.

    I am now struggling with the advantages/disadvantages of getting PV solar installed at our new home. There is an unobscured roof space for a 4kWp array but, even with an install cost at the lower end of the range, I cannot seem to make the sums add up given the falling level of FIT payments. I guess that I am not alone in thinking that, until battery storage becomes more affordable, solar PV is a life choice rather than a sensible financial decision. I don’t really want to get quotes unless I am minded to take the installation forward. Am I missing something?

    Cheap batts would help, but far more important today is the install cost.

    The government's gutting of solar and wind on the supply side, and over-reaction to demand side has damaged the whole supply chain - less installs = higher costs than we would otherwise be seeing.

    Then add on the damage from the MIP, with panels in the EU about 30% higher than elsewhere. With panels representing about 30% of the install cost, that adds ~10% to the overall cost.

    In a country like Australia where PV is well supported, they are seeing install costs of approx £3k for a 5kWp system. Even at UK generation rates, I'd suggest that would be a no-brainer.
    Mart. Cardiff. 5.58 kWp PV systems (3.58 ESE & 2.0 WNW)

    For general PV advice please see the PV FAQ thread on the Green & Ethical Board.
  • System
    System Posts: 178,086 Community Admin
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    Martyn1981 wrote: »

    they are seeing install costs of approx £3k for a 5kWp system. Even at UK generation rates, I'd suggest that would be a no-brainer.

    Therein lies the problem....
  • Zarch
    Zarch Posts: 393 Forumite
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    My installer came round to sort my inverter issue out yesterday. I paid £5,600 for my system 3 years ago. He reckons the same system now would be between £3,500 and £4,500 at todays prices. Not sure how long it would take you to recover that.

    I am just over 1/2 way to recover my costs in 3 years.

    At current 3.9p generation and 5.2p export tariffs you would get around £2800 on FIT payments on a 4kWp system in 10 years.

    Then if you could save £15/month in energy that should get you over £2000 on top.

    All figures from my hooky spreadsheet and inflation linked :)

    My figures seem to match the installer maths pretty well, but I don't always agree with their inflated inflation(?) and high home use estimates. ;)

    So whilst system installs from a few years ago look to cover their costs in say 6 or 7 years..... that figure appears to be more like 9 or 10 now?

    Is that a fair assumption?

    But surely you install solar knowing you're playing the long game, so its years 7,8,9,10 and onwards were you really reap the reward right?
    17 x 300W panels (5.1kW) on a 3.68kW SolarEdge system in Sunny Sheffield.
    12kW Pylontech battery storage system with Lux AC controller
    Creator of the Energy Stats UK website and @energystatsuk Twitter Feed
  • NigeWick
    NigeWick Posts: 2,714 Forumite
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    I think solar is a lifestyle choice for those of us who can afford to be early adopters at present. I can also a battery to go with it, and, an EV to help use up the solar produced.

    It looks as though solar and battery will be a viable option for most in just a few years. If HMGov backed renewables instead of fossil & nuclear generation it would be a lot sooner.
    The mind of the bigot is like the pupil of the eye; the more light you pour upon it, the more it will contract.
    Oliver Wendell Holmes
  • Zarch
    Zarch Posts: 393 Forumite
    First Anniversary Name Dropper First Post
    edited 5 July 2018 at 9:40AM
    The obvious question then remains, if you can still get £250/year back now on current FIT tariffs on a 4kWh system, where is incentive to install once the FIT disappear next year?

    You'd be lucky to get your money back over 20 years just from energy saved.

    Will there be FIT v2? What could it look like?

    If the govt do change to a different model could previous installs jump to the new pricing model if its a better deal?

    ie, take the panels off, have them installed again under the new terms? :)
    17 x 300W panels (5.1kW) on a 3.68kW SolarEdge system in Sunny Sheffield.
    12kW Pylontech battery storage system with Lux AC controller
    Creator of the Energy Stats UK website and @energystatsuk Twitter Feed
  • System
    System Posts: 178,086 Community Admin
    Photogenic Name Dropper First Post
    Zarch wrote: »

    But surely you install solar knowing you're playing the long game, so its years 7,8,9,10 and onwards were you really reap the reward right?

    As a senior, the breakeven point is a factor..........
  • Martyn1981
    Martyn1981 Posts: 14,731 Forumite
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    edited 5 July 2018 at 11:02AM
    Zarch wrote: »
    The obvious question then remains, if you can still get £250/year back now on current FIT tariffs on a 4kWh system, where is incentive to install once the FIT disappear next year?

    You'd be lucky to get your money back over 20 years just from energy saved.

    Yep, there's the rub. Part of the problem is that leccy prices (wholesale and retail) are too low, as they don't reflect many costs, such as all AGW, health impacts, older nuclear decommissioning, the 'cheap' price current nuclear was sold off at, and so on.

    This has a double whammy on prosumers (producer/consumers) as savings against import would be greater, and the export value would be higher. Instead, come Apr, new installs won't get any FiT nor export.
    Zarch wrote: »
    Will there be FIT v2? What could it look like?

    Let's hope so. A model wrapped up with storage would be nice.

    There was a recent article in the Guardian about the end of FiT, and one commentator proudly pointed out that this was a good thing as the subsidy on HPC would only be 5-6p/kWh. I pointed out that the FiT subsidy is only 4p/kWh. And that PV has been supported for 8yrs, v's the 60yrs that nuclear has been subsidised.

    I don't think folk realise how little support the RE industry needs now, but also how important that 'little' help still is.

    In a world that is starting to shift from large scale centralised generation, to a smaller and more distributed form of generation, you'd think the UK government would get on board.

    PS The FiT @4p on 100,000 new domestic installs each year generating 4,000kWhs, would be £16m pa, v's the £1.3bn pa for HPC. So if PV is a tad cheaper already, and the subsidy element is 'trivial' compared to the nuclear allocation(s), then why not?
    Mart. Cardiff. 5.58 kWp PV systems (3.58 ESE & 2.0 WNW)

    For general PV advice please see the PV FAQ thread on the Green & Ethical Board.
  • Zarch wrote: »
    At current 3.9p generation and 5.2p export tariffs you would get around £2800 on FIT payments on a 4kWp system in 10 years.

    Then if you could save £15/month in energy that should get you over £2000 on top.

    All figures from my hooky spreadsheet and inflation linked :)

    My figures seem to match the installer maths pretty well, but I don't always agree with their inflated inflation(?) and high home use estimates. ;)

    So whilst system installs from a few years ago look to cover their costs in say 6 or 7 years..... that figure appears to be more like 9 or 10 now?

    Is that a fair assumption?

    But surely you install solar knowing you're playing the long game, so its years 7,8,9,10 and onwards were you really reap the reward right?

    I would agree with that. My installer has been pretty accurate with his projections although probably optimistic with savings. When I connected I was saving £20 per month on my electric which will have increased now but that was summer months. Over 12 months probably nearer £15 but again higher now due to increased prices.
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