Solar News Update
If you’re having trouble keeping up with the latest news on the solar industry, you’re not alone. With all the recent confusion surrounding the government backed feed in tariff, you’d be forgiven for thinking now is probably not the best time to invest in solar. In actual fact the opposite is true.Whilst the feed in tariff rate has come down and is now confirmed at 21p/KWh until 1st July 2012 the total consumer demand has driven down the price of solar modules themselves together with the overall cost of an installation. The average price has dropped by up to 30% in some cases with both domestic and commercial investors still being able to achieve a return on investment ranging between 6-11% This is tax free, inflation linked and guaranteed by the government for the next 25 years, meaning the financial incentive for installing solar is a lot stronger than you might think.
Up to 11% Return on Investment
A 4Kwp system made up of 16 panels should cost in the region of £8,500 fully installed together with the necessary MCS certification to qualify for your feed in tariff contribution.A system of this size should generate up to 3,434 kWh a year, providing annual FIT payments of £772 and bill savings of £242, giving an overall tax-free earning of £1,014. This is before you take inflation and future energy price rises into account and would take between 7-8 years to pay back.
Energy Performance Certificate (EPC)
As from 1st April 2012 every home considering a solar installation will need an EPC at grade D or above in order to receive the full feed-in tariff. The extra energy efficiency requirements should not put you off as the government has estimated that around half of UK homes meet grade D already. By adding a solar installation to your property in itself will significantly improve your overall energy rating however, if your house doesn’t reach the required grade it could be as simple as adding 10cm of insulation in your loft. You may also be able to take advantage of the current government grants on offer for the fitting of loft and wall insulation making energy saving very affordable. An EPC should cost around £60 which is fully refundable with every Chiltern Solar installation.
Feed in Tariff Going Forward
The Department of Energy and Climate Change has outlined a plan for the feed in tariff over the next three years which will be based on the total volume of solar installations across the UK. Following on from the current feed in tariff rate of 21p / KWhand depending on the uptake of solar installations registered in March and April 2012 the feed in tariff from July until the next review in October 2012 will be between 13.6p – 16.5p/KWh
From October 2012 the feed in tariff reviews will be carried out every six months in April and October until 2015. These reviews are designed to push the costs of solar technology and installations down even further to continue to be able to offer an attractive return on investment for consumers and commercial businesses going forward.
Despite all the changes and recent uncertainty solar is still an attractive proposition for a number of reasons – some financial, some environmental.
• Guaranteed feed-in tariff rate of 21p per kWh for 25years.
• Tax free inflation linked investment with returns of up to 11%
• Price of panels and installation 30% reduced
• Energy prices are going up, 10% year on year
• It’s good for the planet – reduce your CO2 emissions
Posted in Blog, Solar Industry News