Solar Panels - NW England

[Zhen]

Hi there,
I'm thinking of getting solar panels put onto our roof, and wondered if anyone had done this? Just wanted to ask for opinions whether you believe it's worthwhile, also whether anyone could recommend a supplier (we are based in Chester).

Thanks!

We live in Norfolk and investigated it closely.
We aren't going ahead, not econimical enough. If Lekki prices soar (perfectly possible), and if the panels really do last and perform as predicted (big IF), we'd get our money back in about 23 years (ie, returns would equate to what we'd get by dumping the same money in a building society account).

But it's a lot to invest up front for that late and uncertain return.

I was weakly positive and would have gone ahead if DH was more enthusiastic, but he went off the idea when he thought about it long enough.

Are you sure Supinate?
In April this year the government introduced a new feed-in-tariff which pays 42p a unit for electricity and has brought the payback time down to around 8 to 10 years.

Zhen - are you thinking about solar-thermal (heats your hot water) or solar pv (generates electricity).

In both cases you need a South-facing roof. Solar thermal is cheaper (starts at around £3,800) but currently there's no payment, although the government has said it will introduce a Renewable Heat Incentive in 2011 which should reduce payback time dramatically; Solar pv starts at around £10k for a 2kW system and as i said there is a very good new incentive scheme in place.

Two reliable companies who cover the Northwest are www.sundog-energy.co.uk/ and www.solarcentury.co.uk/. Be careful there are a lot of cowboys out there - you need to make sure than the product you choose and the installer are both registered with the Microgeneration certification Scheme.

This is a good website with general information www.generateyourown.co.uk

Yes, sorry to say, I am absolutely certain. You only can say there's payback in 8-10 years if you compare to what happens if you kept the money in a box under the mattress.

See Mike Berners-Lee recent discussion on this (although there is a lot wrong with his book too)!!

I used to do a lot of Cost-Benefit Analysis at work and can (did) put together a thorough spreadsheet to consider the relatively options and inputs. I even included factors like the rise in Lekki prices over rate of inflation, and considered the relative true gain after inflation for the building society option (both things ignored in many analyses). Although I left out discount rate because my own preference on that is near to 0% anyway -- and a 10% discount rate is what MBL uses to completely demolish the idea of Solar PV being profitable.

We don't use enough hot water for solar hot water to make sense, and the PV numbers are too far in the future for the return to feel secure.

I agree about a lot of Cowboys in the industry; our first enthusiastic quote the guy was here for 3 hours and was obviously irate when we said we wanted to think about spending £20k for 2.5MW!

Supinate, the feed-in Tariff payment is guaranteed for 25 years and is index-linked. A good solar pv system should be guaranteed for 25 years and should be expected to last even longer.

A 2KW system costing £10,000 should generate around £870 in FiT payments - and that's before you take into account the money you are saving on electricity usage.

There's also an argument that installing solar pv should enhance the value of your property - although obviously that depends on your propoerty and where you live. But if that's the case then you are looking at a return on your investment of about 8%, much better than the bank is offering at the moment.

You should be able to finance the entire cost of the solar pv with a bank loan and repay the loan with the Feed-in Tariff payment. And when the new Green Investment Bank is launched loans like that should be easier to get - and may even be linked to the solar technology so that you pass them on when you sell.

Bank loan?! Are you serious, bank loan?! There is No Way you'll get back a decent return if you're also paying interest to borrow to make the initial capital investment. We only considered Solar PV because we have money sitting in the bank earning so little interest.

I don't have a lot of faith in the panels lasting as well as claimed; the inverters have an expected lifetime of 15 years (that may be optimistic); some of the wiring will need replacing over 25-30 years.

I guess we didn't price up for 2MW installation, but I'm a bit surprised if many really could get a 2 MW installation for as little as 10k GBP.

I guess you're right about potentially increasing value of the property, but the evidence on that isn't convincing -- it may be more a case of helping the property to sell faster rather than for a better price.

I want to put my whole Solar PV spreadsheet online as an interactive thingy, but it means me mastering MySQL or something else like that .

There's a LONG but informative thread on MSE for anyone else interested in the economics. Several real-life examples and lots of points. (The guy on there who posts as Cardew is a right idiotic Git, but he does make some very valid points relative to economics of Solar PV).

George Monbiot at the Guardian has come against Solar PV, too, for broader reasons.
I'm not entirely against... I am pretty neutral but DH went off the idea.

Supinate I haven't read the whole MSE thread you linked to but it dates back to before the feed-in-tariff was launched in April 2010 -- the feed-in-tariff has completely changed the economics of microgeneration.

Was talking to a friend who lives on a farm about this just yesterday evening - they are thinking about getting solar pv put on the roofs of some of their barns and have just done a detailed analysis, their bank has agreed to lend them the money because the repayments on the loan - including the interest - can be met from the income generated by the feed-in-tariff. Lots of farmers are thinking of doing this for this very reason.

If the feed in tariff generates a return of 8 percent (conservative)and you can borrow money at a lower interest rate, you are quids in.

A reputable solar pv manufacturer will GUARANTEE their product for 25 years.

As for Monbiot's argument - I don't buy it. The whole point of microgeneration is that it enables individuals to take control of their energy generation and usage. Most people who generate their own power are much more careful about how they use it and use less of it - and it is absolutley critical that we all use less energy in the future. Its also better for our energy security to have broader ownership of energy assets.If we hang around waiting for the government to invest in massive renewable energy schemes we will be waiting for ever and by the time they do it it will be too late for the planet.

Good article on the BBC website about costs and benefits of solar pv here: news.bbc.co.uk/1/hi/sci/tech/8751862.stm

"A typical three bedroom home in the UK will consume around 3,000 to 4,000 units of electricity (kwh) per year, costing about £1,000.

A roof mounted Photovoltaic (PV) solar system generating around half of the annual consumption could cost in the region of £10,000.

So the PV system will reduce the annual bill by half, with the FIT covering the remainder of the bill.

Assuming the FIT remains in place and linked to electricity tariffs, the PV installation will have paid for itself in about 10 years."

Half the annual consumption? No, no, no; you'd be lucky to get 40% with a 3 MW installation. And the BBC analysis you quote only compares to what would happen if you stuck the money in a box under the mattress, NOT how that money might perform (what returns it might produce) if invested in other ways. Also doesn't include discount rate: most of us would rather have £10k to spend today than have to wait 10 years for it.

As for guaranteeing the panels; look closely; the guarantees aren't worth a lot: 5 years at best. Almost all the installers we spoke too admitted as much. Any guarantee scheme effectively expires when the installers go out of business (look at what happened to Windsave: they went into administration, the founder has started a new and similar business, but there's no service for previous windsave customers whose turbines have broken down -- that includes me!).

The MSE thread does include lengthly discussion of past and current tarriff schemes for solar PV (included in my spreadsheet, too).

I could quibble still more over details, but I don't really enjoy debating so will bow out now; I hope it gives good leads for anyone else interested.

(This is Cantsupinate having name changed).

Thanks so much for your replies, it's definitely given me food for thought. Originally I was thinking of just hot water, but maybe the electricity generation would be a better idea. Our roof faces directly south so it seems a shame not to take advantage of all that lovely sunshine!

I guess I was also curious to see how the government incentive scheme panned out in the light of the general election. The tradesman who installed my new boiler last year reckons as uptake of solar panels increases, the incentives will reduce, and thinks (of course!) that there's no better time to install! However, I won't be using him again .

The salesman is right that the incentives will start to reduce from April 2012 for new installations - so you shouldn't prevaricate for too long. but that's partly to reflect the fact that costs are also expected to fall over that time.

The new government is even more supportive of the feed-in-tariff than the old one.

Make sure you use a reputable installer who is a member of the Microgeneration Certification Scheme (MCS).