Are you a homeowner who has been wondering whether to have solar panels installed on your roof? Maybe to minimise your carbon footprint or reduce your energy bills? Well, you’ll be glad to know that the price has been slowly coming down over the last few years.
It is now possible to buy brand-new roof solar panel systems for your home from as low as £1500. The more expensive solar panel systems are in the price range of £8000. As you can expect, the more you pay for your solar panel system, the higher the output of electricity. There have been significant price reductions over the past few years.
The purpose of this article is to give you an idea of how much roof solar panels cost and having them installed on your home. You will also learn how much money you could save over the next 25 years by investing your money in solar panels for your roof.
Buy Solar Panels for Home.
Whether you have, a domestic or commercial property, solar panels can be installed pretty much anywhere. In some cases, farmers have converted whole farmers’ fields into huge solar energy farms. The solar energy farms generate vast amounts of electricity which the farmer sells back to the National Grid. The earnings from generating electricity on a solar farm must be more profitable than growing crops or raising cattle.
Having solar panels installed on your roof is obviously on a much smaller scale. That’s not to say having a smaller solar panel system installed at your home will not provide you with any benefits. You can reap the financial rewards for the next 25 years. The government’s Feed-In Tariff system can also earn you up to £7250. Not to mention your electricity bills can be reduced up to 50% just by having solar panels installed.
How Much do Roof Solar Panels Cost?
The starting price for domestic solar panel installations is around £1500. At the higher end, you can expect to pay as much as £8000 for solar panels to be installed at a residential property. As a reference point, each solar panel will:
- take approximately 4 m² on your roof
- cost somewhere in the region of 400 and £500 per solar panel
- each panel can generate approximately 425 kWh of electricity every year
Solar panel installation becomes more expensive with the number of solar panels you have installed. Keep in mind though; each solar panel you purchase is generating extra electricity. That is electricity you will not have to buy from your electricity supplier. Also, don’t forget about the tax-free Feed-In Tariff payments from the government.
The average residential solar panel installation consists of either 12 or 16 solar panels. The average cost of a solar panel installation in the UK is between £5000 and £8000. If you have three people or more living in your home, then most professional solar panel installers will recommend you install a 3kWh solar panel system. A 3kWh solar panel system is made up of 12 panels, which provides adequate electricity consumption for the people that live in your home.
Earlier in this article, I mentioned the price drop of solar panels. The reason for the decline in price is because the solar panel manufacturers have developed quicker and more efficient ways of manufacturing them. Another reason for the price drop is because of global warming. People and governments all over the world worry about the effects of global warming. The government’s of many countries around the world subsidise solar panel manufacturers and solar panel installers.
If you were to go back to the year 2010, you would have paid somewhere around £12,500 for a 3kWh solar panel system. Today you would pay between £5000 and £6000 for the same solar power system, but it will have more advanced technology included.
The trend for the price reduction is likely to continue as time goes on. Homeowners who would like to invest in solar panels on the roof of their homes may benefit by waiting a year or two and reap the rewards of the extra savings.
That sounds a lot like false economy. Is it?
If we go back to the start of the decade, the Feed-In Tariff was a lot higher back then than it is now. The Feed-In Tariff is where you get paid when you sell the electricity generated by your solar panels back to the National Grid. The reason the Feed-In Tariff was higher back then was to help homeowners with the costs of installing solar panels on their roofs. As the prices of solar panel manufacturing started to decrease, the Feed-In Tariff also began to lose its value.
Since 2010 the Feed-In Tariff has been on a steady decline in value. Much quicker than the cost of solar panels. What this means is the people who waited a couple of years before having them installed did not make as much money from the electricity generated by the solar panels as did the people back in 2010.
Since the big banking crash in 2008 governments around the world have had to tighten their budgets. It is widely believed by the world’s leading solar energy experts that the Feed-In Tariff rates will continue to be in a downward trend. It is only a matter of time before they are widely affordable and the government’s Feed-In Tariff is abolished.
Time is running out. If you continue to put off investing in solar panels for your home, there is a high chance you will miss out on the government’s Feed-In Tariff altogether.
Tip from roof advisor – are you worried if you bought solar panels now the Feed-In Tariff will continue to decline until it’s not worth anything? Well, don’t worry. Once you have your solar panels installed on your roof the government will continue to pay you the current rate that it’s worth for the next 20 years. That means that your Feed-In Tariff payments will not decline at all over the next 20 years.
Roof Solar Panel Installation Costs
Once you have received a quote for solar panels to be installed on your roof, the costs for installation will be included in the quote.
It is essential to make sure that your solar panel suppliers and installers are Microgeneration Certification Scheme (MCS) registered. Your installer has to be registered with the MCS for you to qualify for the Feed-In Tariff.
Once your roof solar panels are installed, your installer will provide you with an MCS certificate. As soon as you have the certificate, you can apply for the Feed-In Tariff.
Cheap Roof Solar Panels
Is there a way to get cheap solar panels? Over the last ten years, private sector companies and governments have been coming up with ways to make domestic solar panel systems more widely available and affordable for homeowners.
Ten years ago the government was trying to entice homeowners into having solar panels installed by launching the Green deal scheme. The Green deal scheme give homeowners a financial incentive to make their homes more energy-efficient. The government would loan you the money to cover the costs of the installation of solar panels, and with the money you’d save on your energy bills you would pay it back over several years. Unfortunately, in July 2015 the Conservative government decided to scrap the Green deal scheme because it wasn’t meeting its objectives. However private investors have agreed to relaunch the Green deal scheme, but only a handful of providers are offering the loans.
We mentioned earlier in this article how the Feed-In Tariff has been steadily declining in value because the cost of solar panels is becoming more affordable to buy. Over the last few years, there were companies asking homeowners if they would be interested in renting their roofs to them so they could install solar panel systems on them. The agreement was the company would receive the money from the Feed-In Tariff, and you would have lower electricity bills. Everyone’s a winner. Sadly, due to the Feed-In Tariff being in a steady decline in value, it has made this arrangement between the company’s and homeowners unprofitable.
Recently a new scheme has popped up called Solar Buyback. Homeowners who already have solar panel systems installed on their roofs are offered a lump sum of money in return for transferring the Feed-In Tariff payments to the company for the next 20 years.
There are also buy now pay later options available. Some companies will pay for your solar panel installation, and you pay them back by paying monthly payments spread over five years for example.
How Can You Make Money with Solar Energy in the UK?
Having solar panels installed on your roof will enable you to make some extra income. Below are the three main ways you can make money with your roof solar panel installation.
- The renewable heat incentive
- Feed-In Tariff
- lower your energy bills
Let us go through each point and explain it in more detail.
If you have your MCS certificate (which you should be, if not read above), you can make money by signing up to the two parts of the Feed-In Tariff scheme. By signing up to the Feed-In Tariff scheme, you will be making money every year for the next twenty years.
Your current energy supplier who provides you with electricity will pay you for every kilowatt of electricity produced by your solar panels. The amount of money you get paid will be dependent upon your supplier. Once your solar panel system is registered, you can start receiving these payments right away. These payments from your energy provider are also tax-free. You will receive fixed payments for the next 20 years from the government from when your solar panels were installed. This payment is called the Generation Tariff.
Your energy provider will also pay you for every kilowatt of energy produced by the solar panels that you do not use yourself. Every unused kilowatt of energy generated by your solar panel system will be fed back into the main electricity network, and you will get paid for it. Selling your unused electricity back to your supplier in this way is called the Export Tariff.
It’s difficult for a lot of utility companies to figure out exactly how much energy a solar panel system is feeding back onto the grid. An educated guess by industry experts is its to be around 50%.
When smart meters are more widely installed in people’s homes, the figures will be a lot clearer. Smart meters can track precisely how much electricity has been fed back onto the grid. Smart meters enable the energy suppliers to make more accurate Export Tariff payments.
Once your system is registered, you can start to receive payments from your energy supplier. The payment you receive is tax-free and do not interfere with your annual personal tax allowance. You will also receive money from the government for the next twenty years from when the solar panels were installed.
The latest export tariff rates and the latest generation tariff rates are:
Time Period Date Range Export Tariff Generation Tariff
First Quarter 1st January – 31st March 2018 5.03 per kWh 3.93 per kWh
If your home has an EPC rating of D or higher, then these rates are what applies to you. If your home has a rating of E, F or G lower rates will apply.
If you sign up for the Domestic Renewable Heat Incentive Scheme, you will be eligible to receive further payments. Biomass generators, ground source heat pumps, air source heat pumps, and solar panels all qualify for the scheme.
You are eligible to join the scheme from the date displayed on the MCS certificate. Your installer would have checked your system and signed the certificate if no installation faults were detected. The installer would not sign the MCS certificate if the system failed to work correctly.
Once this scheme has approved your application to join, you will have to adhere to the scheme’s rules, which is applicable for seven years. Every year you will have to make a declaration of your compliance. The Domestic Renewable Heat Incentive Scheme will allow you to receive an extra 20.06 pence for every kWh of electricity produced by your solar panels.
Another way you will be making more money from your solar panel installation is your home is no longer just a consumer of electricity. It is also a producer of electricity. Your home does not solely rely upon energy suppliers to have power in your home. Savings on electricity bills will depend on the size of your solar panel installation. You could have savings of up to 50% off your annual electricity bill for the next 25 years.
How Much Money Can You Earn Yearly after Having Solar Panels Installed?
The numbers look good, and that’s without including the Domestic Renewable Heat Incentive Scheme.
Let’s have a look at the average cost of a 3kW solar panel system in the UK which costs approximately £5000. The average house this system is installed in has an electricity bill of roughly £600 per year.
Out of your £5000 investment for solar panels, you will earn approximately 2.1% of your investment back every year from the generation tariff. You will also get the export tariff which will pay you 1.4%. You will even get about 1.5% back from your electricity bills. So you will get about 5% of your £5000 investment back every year which equates to roughly £250.
You will be receiving the Feed-In Tariff for 20 years, and you will be saving on your electricity bills for 25 years. Now if you spread that £250 per year over 25 years it will total to £5500 which means you gained £500.
Brand-new solar panel systems have a life expectancy of between 25 to 30 years from the date of installation. After the 30-year life expectancy, your solar panels will still work, but they become less efficient over time. That means your savings on your electricity bills will become less every year.
Over the last five years, many of us will have noticed our electricity bills increasing year upon year. Energy suppliers are investing more money into renewable energy sources and steering away from using oil and gas. Fossil fuels are becoming more scarce and harder to find. Renewable energy is terrific for the environment, but unfortunately for us, it means the cost of electricity will rise faster than the rate of inflation over the next decade at least.
A study by the Lawrence Berkeley National laboratory conducted their own research and found that up to one-third of homeowners would pay more for a house if it had solar panels installed. Making your home a little more environmentally friendly does have other financial benefits.
Solar Energy UK – is there Any Hidden Costs?
Solar panel systems require very little maintenance once installed. Having them fitted to a homeowners roof out of the way is the perfect place for them. The last thing a solar panel company wants to hear after installing them on a roof is some bad news about a customer falling off the roof trying to carry out some routine maintenance on them.
If you look around you will find companies which will maintain your solar panel system for a yearly fixed fee somewhere in the region of £100 to £200.
In the very rare occurrence that your solar panel system was ever to break the manufacturer’s warranty will the cost of repairs or they will have to replace them with new ones.
Is it the right time for you to have a brand-new solar panel system installed?
Solar panels are self-financing and do wonders for the environment.
If you are going to pursue having solar panels installed on your roof make sure you get in touch with an MCS certified professional installer.