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Is Solar Power Still A Good Investment

Is Solar Power Still A Good Investment
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Over 1.5 million households in Australia have a solar system installed. Solar systems have become increasingly cheaper but so have the feed-in-tariffs (what you get paid for the excess power you generate). With all the changes that have taken place is solar power still a good investment?

Earlier this decade the state governments were offering generous feed-in-tariffs of up to 40c per kWh as an incentive for households to adopt the new technology. These have all been phased out for new solar installs across all states and now we get the minimum retailer feed-in payment of around 5 – 8c per kWh.

Does this mean its no longer worth getting solar?

Although the feed-in has dropped significantly so has the cost of purchasing solar systems. The price of new systems has reduced by around 80% since the start of the decade and this has balanced out the return on investment. So the answer is YES solar power is still a worthwhile investment. You do however need to take following into consideration when purchasing.

Considerations

Power Usage Habits

With the high tariffs you used to get more for the exported power (excess power generated that goes back into the electricity grid) than you paid for the imported power. This made it more beneficial to consume less power during the day and more at night. With the present low tariffs it is better to produce consumable power than it is to have it go back into the grid.

Panel orientation

In the past it was considered best to install your panels on a northern facing roof with a 30 degree pitch in the southern hemisphere. The opposite in the northern hemisphere. This orientation would give you the maximum total power output from the system.

It is now important to factor in what part of the day you consume the most electricity when determining panel placement. For most households their power consumption is higher in the afternoon and evening when parents and children return from work and school. Considering this it is often better to place the panels on a North-West to West facing roof so you generate more power toward the end of the day.
Note:It is also important to factor in shade and available roof space.

Battery StorageIs Solar Power Still A Good Investment

In my opinion batterie storage at this time is not worthwhile. Storage capacity is small, battery size is
large, lifespan is low and prices are high. This will and is changing over time as the technology advances so keep your eyes out. It may be worthwhile purchasing a system that has the ability to add battery storage later.

Calculation

My favourite calculator for determining solar output is PVWatts Calculator by the National Renewable Energy Laboratory. It is world wide and the most feature rich calculator I have found. There are also many basic calculators on most solar and energy providers websites. These calculators will give you a general indication of the size of the solar system you require based on your present consumption.

I have compared the results from PVWatts Calculator to my own solar system output and found it to be incredibly accurate!

Caution

There has been a move for energy suppliers and solar companies to offer finance options. Many are offering $0 upfront cost to get systems supplied and installed. Read the terms and conditions as this service is likely to cost you significantly and will in turn affect your ROI.

You get what you pay for. This is also true with solar systems. The cheapest system will not always be the best value in the long run and you should consider

  • Warranty on the Inverter
  • Efficiency and features of the Inverter
  • Warranty and output guarantee on the panels
  • Installation Quality

Shop around and get a minimum of 3 quotes and don’t forget to haggle. Keep an eye out for specials and off season discounts. Read reviews and forums on the inverters, panels and installer you are considering.

Conclusion

Installing solar has the benefit of reducing your carbon footprint as well as your electricity bills. The payback time frame is around 4 – 6 years for any size system. It is still a good return on investment compared to other types of investments. Installing solar may even have the added benefit of increasing the resale value of your property.

I would love to hear your opinions and experiences when it comes to solar systems. Comment below or send me an email.

Comments (1)

  • We rent so there’s no chance of getting solar power for now, but we would if we owned. Not only is it good for the environment, but financially I think it will get more attractive every single year so we’ll definitely get something and a battery when we buy.

    Mr DDU

    Reply

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