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Why you need to invest in solar panels now

An increasing focus on alternative energy sources from the Government has encouraged a widespread installation of solar panels across the UK. However, after 12 December 2011 the legislation and monetary bonuses associated with solar panels will change. This will mean that installing solar panels before this date will be more financially beneficial for households.

These changes will see a reduction in FITs (Feed-In-Tariffs) which will see the subsidies received fall. This prompted solarenergyexperts.co.uk to commission a survey into the ways in which UK residents react to solar panels, hoping to establish reasons why households do not consider this option as well as what costs they expect to incur.

What are the current costs associated with solar panels?

Solar panels, such as sanyo solar panels, have a number of associated costs. These include the cost of installation as well as the financial benefits and bonuses which are earned thereafter.

Subsidies: currently, households with solar panels receive subsidies that reach an average annual figure of over £1,000. The typical return of £1,190 is said to be comprised of three different figures: Generation Tariff (£1,060), Export Tariff (£40) and energy bill reductions (£90).

Generation Tariff offers financial benefits for all energy which is produced via solar power in a home, regardless of whether that is then used. The Export Tariff offers additional payments for any energy that is put-back or “exported” to the National Grid.

Installation: installation costs now total an average of £9,000. This is 25% lower than the previous average of £12,000, demonstrating how overall costs are continuing to fall. It is important to remember that installation costs will usually include the cost of the solar panels as well. Solar panel comparison is offered by sites such as solarenergyexperts.co.uk in order to help consumers select the best, and most economically viable, products for their home.

Future: the saving made by installing solar panels in your home means that the technology will have paid for itself within eight years. Combining this data with the fact that solar panels have an average life expectancy of 25-30 years demonstrates that customers could have 17-22 years of pure savings.

How are these costs likely to change?

The new legislation, which will take effect from 12 December 2011 will see a reduction in the above subsidies or Feed-In-Tariffs. The Generation Tariff, which produces the highest level of savings for households, will be affected by the RPI (Retail Prices Index), rising and falling with inflation. The current rate of savings (43.3p per kilowatt hour of energy produced) will be locked in for customers who install solar panels before the aforementioned data, with the prices being index-linked for 25 years.

What are FITs?


Feed-In-Tariffs are financial support schemes which offer subsidies to households that use solar energy. As outlined above, these fall into separate categories, meaning that customers could profit from numerous benefits.

Changes to the FITs are therefore only expected to affect new entrants to the schemes, with the support remaining the same for those currently registered.

Who should invest in solar panels?

The changes in legislation and subsidies mean that everyone should invest in solar panels before it is too late. The survey conducted by solarenergyexperts.co.uk found that the majority of those interviewed were in the prime installation bracket. This bracket includes individuals who live in a house with a minimum of three bedrooms and spend more than £40 per month on their energy bills.

The cost of installation and lack of information on solar panels were said to be the main reasons why consumers failed to have solar panels installed. For many people, finding the best solar panels translates into finding them at the right price – so take your time, compare prices and register before 12 December 2011.

 

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