Cost and Benefits
Prices typically range from £2,700 to £5,300 depending on system size, and components.
Thanks to the generous government backed generation tariff known as the Feed in Tariff (or FiTs), you can make an estimated annual return on investment around 10-16%, for 20 years. This depends on the size of the system, components selected, the specifics of the installation, the weather, and your electricity usage. Return on investment figures are based on a combination of feed in tariff, and export payments, and savings on your electricity bills. You get paid for the electricity generated regardless of how much of it you use.
The FiTs are income TAX FREE, and INDEX LINKED (the retail price index), helping preserve the value of your investment over time.
You'll be paid by your electricity supplier every 3 months, after giving a reading from your generation meter.
Many of our clients install solar PV to help "future proof" the electricity bills, as well as doing their part for the environment.
Example: 4 kw peak on a south-west, or south-east facing, unshaded roof (16 panels typically) would generate an estimated 3416 kwh of electricity per year. If your property is more southerly facing, results will be better, if closer to east or west, slightly less *** based on official government performance estimates ***:
|Fully Installed (inc Vat) (Qp)||£5133.84|
|Estimated Annual System Output 1 (Gd)||£2778.30|
|Feed in Tariff rate 2 (Vf)||£372.01|
|Annual Value of Electricity consumed||£208.37|
|Annual value of electricity exported||£67.37|
|Total Value of Electricity generated||£647.76|
|Basic Payback (years)||7.93|
|Annual Return on Investment||12.6%|
|Total Value of Electricity generated||£12955.21|
Income: 3416kw x 13.88p (FiT rate) = £457.40 in the first year.
Income: 50% of 3416 kwh x 4.85p (deemed export portion of electricity produced) = £82.84
Savings on electricity bill: 50% of 3416kwh x 15p (average price of electricity in the UK) = £256.2
Total benefit for solar PV installed on a house : £457.40 + 82.84 + 256.20 = £796.44 in the first year. £15,928.84 over 20 years total benefit. Assuming £5000 cost, full installed, 15.89% return on investment, payback in 6.27 years.
This does not included the increased FiT over time linked to retail price index (RPI), or the cost of electricity rising over time, which of course will increase the benefit, and reduce the payback period. For the above example, if you assume 2% RPI, and 3% increase in cost of electricity / year (conservatively), you would benefit an additional £3,285 over 20 years, and payback would be in 5.92 years.