If you are considering getting solar panels installed on your home, you should treat them as an investment. In other words, you need to consider how much money they will save/make for you and how long they will take to pay for themselves. Are they a wise investment when compared other places you could put your money? We set out to answer this question.
How much money do solar panels make?
Solar panels make money in three different ways:
1. The feed in tariff (FIT).
The feed-in tariff was introduced in April 2010 as an incentive for people to generate their own green electricity. Your electricity supplier is obliged to pay you for every unit of electricity your panels produce — think of it as a little thank you for helping the environment.
2. Electricity savings
The electricity produced by your solar panels will be fed directly into your house, and will power your appliances, lighting etc. You will therefore save money on your electricity bill.
3. Export earnings
Finally, as you probably won’t use all of the power your panels generate, the remainder will be sold back to the national grid. You will be paid a set price for every unit you export.
See also: Solar Panels — 3 Ways You Save.
Add these three figures together and you can see how much money your panels will make you.
If you take this total, divide it by the cost of installing the system and multiply it by one hundred, you can work out the return on investment (ROI) your solar panels give you.
How do they compare to other types of investment?
We looked at three well known price comparison websites and found the best possible rates for saving accounts, fixed rate bonds and cash ISA’s. We also calculated the return you would get from an ‘ideal’ solar panel system — that is, 16 panels on a nice, un-shaded, south-facing roof. We calculated the cost and ROI of the panels in the exact same way we would for a real customer.
Just take a look at the results below.
As you can see, it’s no exaggeration to say that solar panels blow everything else out of the water!
It’s also worth noting that once your system has been connected and registered, the feed in tariff is guaranteed for 20 years. It is also index-linked, meaning that the rate you get will rise to reflect inflation and increases in the cost of living.
How much would solar panels make on my home?
Give us your details and Go Greena will prepare a personised quote for your property, including an estimated cost and return on investment, and send it to you in the post. It’s free and no-obligation. Request a quote here.
- Solar Panels
- Article: How Solar Panels Work – A Guide For Dummies
- Article: Solar panels – Are they really a clean energy technology?