You can already connect your solar photovoltaic (PV) system to the national grid and sell your surplus electricity, but from April 2010 you will get paid for everything you generate.
Solar Photovolataic (PV) panels convert sunlight into electricity and contrary to popular belief work very well in the UK. The panels work in daylight, so while they produce more the sunnier it is, as long as it is daylight they will be working. The systems are fully automated and require no input from you; you use what you generate first and automatically ‘export’ any surplus. If you are using more than you generate you ‘import’ the amount you need. Typically a domestic home will export 40% of what you generate.
Grants and costs
Between now and March 2010 you can get a grant of £2,500 as long as you use an MCS (Microgeneration Certification Scheme) accredited product and installer. The cost of a domestic system, depending on what you want to generate, or the size of your roof, is typically between £10,000 and £15,000. Which is quite an outlay, but as from April 2010 you will be paid for all the electricity you generate. The panels are guaranteed for 25 years, but will last longer. It clearly also adds value to your home, the Nationwide suggest as much as 10%.
Case Study
We are currently installing a system for a customer in Liverpool. His system will cost £11.500. Through the Low Carbon Buildings Programme we will be able to obtain a £2,500 grant for him, reducing his capital costs to £9,500. His system is predicted to generate 1865 kwh’s (or units) per year, and offset over 1 tonne of CO². What will this mean based on the new Feed in Tariffs from April?
Income/savings
1865 x 36.5p = £680.73 (The amount he will be paid for generating the electricity)
1119 x 11p = £111.90 (The amount he will save by not having to buy that amount of
electricity as he has generated it himself).
746x 5p = £37.30p (The amount he will be paid for his exported electricity)
Total income/saving £829.93 per year. This figure will increase each year as electricity prices increase, as may the amount you are paid for your exported electricity. The main tariff for income is fixed for 25 years though, it will not go down. So during the 25 years, if electricity prices do not change the payback will be £20,748.25. But we all know what is happening to electricity prices. The government work on a basis of 10% increase annually, but this is we think conservative. As prices go up, your savings increase.
The larger the system the more you will be paid and the quicker the payback. This also applies to commercial premises and roofs.
* Figures based on latest government consultation but unlikely to change.
