There is a lot of marketing information around about Grid Connected Solar Panels but not many facts.
Here’s how I evaluated a basic system for our house in a Melbourne Suburb.
- We use around 16kw hours (kwhr) of electricity per day which is fairly typical;
- For each 1kw of solar panels we can expect to generate around 1300kw hours per year that’s an average around 3.5 kw hours per day;
- For the basic 1.5kw system we should generate on average about 5.2kwhrs;
- Our current tariffs for power is $0.2025 /kwhr regardless of time of day;
- If we go solar we will receive $0.66 for every kwhr we put back into the grid;
- As part of going solar our tariffs will change to:
– $0.2625/kwhr peak times (7.00am – 11.00pm Monday to Friday)
– $0.1075/kwhr off peak (all times other than peak)
Estimation
The cheaper off peak power should offset the more expensive peak power.
Weekdays (as we both work and the house is empty during the day) we should be able to put 2.5 kwhrs into the grid and use 2.7kwhrs running fridges, and so on.
Income 2.5kwhr @ $0.66 = $1.65
Saving 2.7kwhr @ $0.2625 = $0.70
Benefit = $1.65 + $0.70 x 260 days
______________________________
= $611
Weekends we probably will only put 1kwhr into the grid
Income 1kwhr @ $0.66 = $0.66
Saving 4.2kwhr @ $0.1075= $0.45
Benefit = $0.66 + $0.45 x 104 days
______________________________
= $115
Total annual benefit is $726
Is it worth it?
Well there are some 1.5kw systems being advertised now with various rebates which cost around $3000.
If you had $3000 on term deposit it would now (Jan 2011) be returning 6% that’s $180 a year, which would then be taxed. Alternatively if you put the cost on your mortgage that will mean that you are borrowing $3000 at a rate of around 8%. That’s costing around $240.
From these figures in Victoria it looks like for the basic system we could be around $500 better off. The tariffs and buy back figures vary from state to state so you will have to do your own estimation.
If you are looking to get a system you need to know that there may additional charges for things like:
- Installation on a tiled roof;
- A frame on a flat roof;
- Split array over two different sections of roof;
- Lifting and access if you have a 2 story houses; and
- Charges if you are outside the metropolitan area.
If you’ve already decided that solar power is for you, this additional article about Solar Panel Alignment may come handy – click here to read.
This article was contributed by Brian Ashworth. Brian is a Chartered Civil Engineer with over 30 years experience in Water Engineering, who lives in Wyndham Vale, VIC. For a great collection of tips on building or renovating a house visit his blog A New House.
{ 2 comments… read them below or add one }
Don’t forget to factor in maintenance costs, and the wearing out of the solar panels. If they last 10 years before being replaced then they are costing you $300 a year.
Also if/when they reduce the feed in tariffs you might end up making a loss.
There are always risks but…….
Maintenance is minimal these are basically solid state devices (how often to TV’s break down these days?
Most panel manufacturers offer warranties of more than 20 years.
Currently on the figures in the evaluation break even is less than your figure of ten years.
Although the feed in rate ‘may’ go down what we know for certain is that the usage tariffs will go up. With the Emissions Trading/Carbon Tax this rise is going to be in excess of inflation.