New Deal for Solar PV

This week has seen another rush on Solar PV as people try to get a system installed before the next reduction in Feed-in Tariff at the end of this month.  From the 1st August the generation tariff will reduce from 21p per unit to 16p per unit and all I keep hearing is that ‘it won’t be worth it’ any more.

I disagree!  I’ve done the numbers and in my view, the deal just got better!  How can that be if the tariff is reducing?  Well prices have come down yet again in recent weeks and even on the new tariff you can still achieve 10 year payback and 10% annual return on investment. Let me show you an example…

I’ll work on a 4kWp system (that’s 16 x 250W panels) on a south-easterly facing roof, 45 degree incline and no over-shading, so not perfect conditions.

The system will produce approx 3190 kWh electricity per year.  Kilowatt Hours (kWh) are the same unit of measure you see on your electricity bill.  The return on investment is calculated as follows:

Generation Tariff (this is what your energy company pay you for each kWh generated)

3190 x 16p = £510.40

Export Tariff (your energy company will assume you export 50% of what you generate as standard)

3190 x 50% = 1595

1595 x 4.5p = £71.77

Saving on Electricity Bill (assuming you use 50% of what you generate and a current energy cost of 12p/kWh)

1595 x 12p = £191.40

Total Income & Savings per year = £773.57

Cost to Install with Morgans Solar = £7,455

Payback = £7455 divided by £773.57 = Year 10 (and that’s not taking into account any increase in energy costs or inflation each year)

Average Annual ROI = 10%

So getting back to my question of how the deal just got better, you can achieve the same return on investment % with a 10 year payback but using less of your capital to buy the system on the first place.  And let’s not forget, electricity prices are only going one way – up!  The value of each unit of electricity you can generate will increase over the 20-year term of the feed-in tariff.

Morgans Solar like many companies are reviewing our prices all the time to make sure that we are always giving you the best deal available.  There are some example price packages on the website (http://morganssolar.com/about-solar/example-price-packages/) which have been updated this week with the latest reductions so why not check them out?  

If you would like a quick quotation for your property you can either complete the quick quotation form on the home page of our website (http://morganssolar.com/) or simply call me on 01525 213103.  We aim to get something back to you within 1 working day.