Solar power can make you money from daylight, which is free for everyone.
Thanks to growing global demand, there have been major improvements in solar panel technology in recent years and the quantity of panels being produced has increased significantly. As a result, the cost of installing solar panels has also dropped dramatically in the last decade.
Today, producing electricity from daylight (a truly renewable source) is a technology that's accessible to many homeowners, as well as businesses and commercial property owners. It represents one of the most proven and effective ways to switch to clean electricity. Solar panels cost around four to five thousand pounds to install however the solar energy system will more than pay for itself over the twenty years plus lifetime. It is also worth remember to factor in rising electricity prices from your current energy supplier when working out any cost savings.
You can earn or save money in the following three ways:
- It reduces your energy bill, as you are generating your own electricity (saving around 14p/kWh, which is the cost you are charged by your energy supplier)
- You earn income for every unit you export to the grid (typically around 5p/ kWh)
- The Feed-in Tariff (FIT) is a Government-backed financial scheme which pays a green bonus for each unit (kilowatt hour) you produce for the next twenty years (around 4p/ kWh).
Ideal Timing for Solar Power Use
The biggest financial and environmental benefits are achieved when the power generated by your solar panels is used in your home. This is because the amount you are charged for each unit of electricity is about three times the amount you are paid for exporting power.
This video from the Fully Charged show shows installers at work on the roof of Robert Llewellyn of Red Dwarf fame and how he uses this power to top up the battery on his electric car.
Solar Hot Water Heating
If you are unlikely to use all the electrical power generated during the summer, then using the excess energy to heat your hot water is another option. This is instead of installing a separate solar thermal collector on your roof and acts like an immersion heater in your hot water tank. Your installer will be able to discuss the best options for your home depending on your personal circumstances.
What Is the Feed-In Tariff?
The Feed-in Tariff (FIT) is a Government programme aimed at promoting the uptake of small-scale renewable and low-carbon electricity generation technologies. Under FIT, households and businesses (in England, Scotland and Wales) are paid for the electricity they produce.
Payments are paid quarterly via an energy supplier. Payments are tax-free, index-linked and guaranteed for 20 years. According to the Energy Saving Trust, a typical home can earn £150 per year under the FIT scheme however, this scheme is due to close for new applicants in Spring 2019. There is less than a year left to take advantage of this financial incentive so if you've always wanted solar now is the time to act.
In order to qualify for the FIT;
- Your home will need to have an energy performance certificate (EPC) of D or above. If you bought your home in the last ten years you will already have a valid EPC. If not, you can find an accredited domestic energy assessor who will be able to assess your home and create a certificate. https://www.epcregister.com/searchAssessor.html
- Feed-in Tariff rates do change, so please speak to several installers for quotes the current FIT rates and savings. The scheme will end for new registrations in April 2019.
Microgeneration certificate scheme (MCS) accredited installers are compulsory to qualify for FIT and can be found through the MCS website.
Five Top Tips for Making the Most Money from Your Solar Panels
- Save costs by combining work. If your installer advises that scaffolding is necessary to access the roof for installation, then combine the work with other house or home maintenance jobs. Or consider adding a solar thermal system at the same time.
- Schedule energy intensive activities, such as charging an electric car or using the washing machine, during daylight hours when the free, clean energy is being generated. The use of timers is another great way to make use of the cheaper daytime energy.
- You can still switch suppliers to find the cheapest gas and electricity tariffs even when you have solar panels on your roof. You will find a Government list of FIT licensees here: https://www.ofgem.gov.uk/environmental-programmes/fit/contacts-guidance-and-resources/fit-licensee-contact-details
- Generally, cleaning is not necessary but if you live in a particularly dusty street or area it is best to have the panels cleaned once a year to maintain efficient operation.
- During the twenty-year lifetime of your solar panels, the inverter is the only component in the system that might need replacing. An inverter could cost around £800 but could be covered by the installer's warranty. Therefore, if there is an option to extend the warranty for the inverter to save on unexpected costs it may be wise to do so depending on the cost of doing so.
For more information on making the most from your solar panels see: https://www.which.co.uk/reviews/solar-panels/article/best-solar-panel-brands/make-the-most-of-your-solar-panels
If this has piqued your interest and you want to know more about power from the sun, then please read our article on The Amazing Benefits of Installing Solar Panels for a more detailed overview.
Solar Panel Myth Busters
Some people believe solar panels only generate electricity when it is sunny, or that solar panels do not work in colder climates. We are happy to bust both myths - as neither is true!
Once you have panels installed in your home you can monitor the production figures via the internet on cold or overcast days and see how efficient they are for yourself.
However, one surprising feature is that to fit with legislation, if there is a power cut solar panels are designed to also stop working.
Can I Have Both Solar Thermal and Solar Panels on My Roof?
Absolutely, you can have solar thermal and solar panels on your roof. The only limitation is roof space, but most homes would have sufficient roof space. Each system requires about an area of about 4m2 so most homes could accommodate both solar thermal and PV panels.
The two systems are perfectly complementary although they operate entirely separately as one involves electric wires and an inverter and one is water heating so pipes and a pump.
They both receive Government financial support through the feed-in tariff for solar photovoltaic panels and the renewable heat incentive for the solar thermal collectors.
Many MCS accredited installers can install both so there may be a financial benefit to having them fitted at the same time especially if scaffolding is required to gain access to your roof.
Battery Storage with Solar Panels
Finally, if you want to go all out, a home battery pack can be fitted to store the solar generated electricity, allowing you to use green power at night. This type of solar-plus-storage system is particularly appealing for people who like the idea of being 'off grid'.
A battery system will cost upwards of £2,500. Like all clean tech, the cost of batteries is falling year-on-year, so as it becomes more affordable this is definitely one to watch! However, at current prices batteries to store solar energy are not an option for everyone with solar panels on their roof.
However, if the idea of solar and a battery backup is of interest there are a huge range of suppliers including IKEA, Tesla, Moixa and Nissan (yes, of the electric car Nissan Leaf fame) to name but a few.
Now you know you can make money from solar power, take a look at our article on the benefits of installing solar panels for more information on what solar panels to buy and where to buy them from.
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