Solar panel cost

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Solar panels can cut your electricity bills by as much as half. Here, we look at the cost of solar panels and the options available.

Just like most innovations, the cost of solar panels has reduced over time as technology gets smarter. When looking at the cost of solar panels, it is important not to forget to consider the financial benefits, such such as how much they can cut your electricity bills, what your return on the Feed-in Tariff might be and whether you could be eligible for free solar panels.

Here, we breakdown the finances of solar panels and evaluate the solar panel costs.

How much do solar panels cost?

The average cost of solar panels and installation is between £6,000 and £9,000.

There are some schemes that offer free solar panels, where you keep the free electricity the panels generate but the installer keeps the Feed-in Tariff payments. Find out more about the Feed-in Tariff.

Should I go for free solar panels, or should I buy them outright?

Buy your own if:

  • You have money available to cover the up-front costs.

  • You want to earn money on the excess energy you generate.

  • You want to make long-term savings on your energy bills. Energy prices will go up over time, so the amount your solar panels save you will go up too. In fact, a recent survey found eight in 10 of those with solar panels installed them to protect themselves against future energy price rises.

Get free solar panels if:

  • You don't have the initial money to invest, and aren’t able to secure a solar panel loan.

  • You're happy to just make savings on your electricity bill. You won't make any money from Feed-in Tariff with these schemes, but you will still save on your electricity bill.

  • You're worried about on-going maintenance costs; maintenance is included in free solar schemes.

  • You want to make long-term savings on your energy bills. Energy prices will go up over time, so the amount your solar panels save you will go up too.

Get a solar panel loan if:

  • You don’t want or can’t afford to pay for your solar panels up front.

  • You want to take advantage of Feed-in Tariff in the future and earn a tax-free income over the next 20 years. Your Feed-in Tariff payments and savings on your bill will pay back your loan over 10 years, and you’re free to keep the income for the following 10 years.

  • You want to make long-term savings on your energy bills. Energy prices will go up over time, so the amount your solar panels save you will go up too.

How can companies afford to offer free solar panels?

In April 2010, the government introduced the Feed-in Tariff as part of a drive to reduce carbon emissions in the UK. With the Feed-in Tariff you get paid for generating your own renewable energy.

The company will take the money your solar panels earn from the Feed-in Tariff to recoup its investment.

Are solar panels a good investment?

Yes. If you buy solar panels outright or secure a solar loan, they'll give you a good return on your money. In fact, they could well be a better place to invest than a savings account. Nine out of 10 solar panel owners would recommend them to their friends and family.

Solar panels cost

Can solar panels add value to my property?

Yes, they could. A YouGov survey from 2009 found that home buyers ranked energy efficiency as the third-most important reason to buy a property, just behind outdoor space and a garage. And, recent uSwitch research showed that solar panels were the fourth-most important consideration for potential homeowners.

Does my mortgage company need to know?

Solar may be viewed as a modification by mortgage lenders - just like an extension or dormer window - so it's best to let them know.

Will the quality of my electricity suffer?

No. You won't notice any difference. If the panels aren't producing much electricity, for instance at night, you'll just use electricity from the Grid instead.

Solar panels and the Feed-in Tariff

While the upfront costs of solar panels can seem prohibitive many people forget that not only can they save you money in terms of how much energy you use, but they can generate money too.

The energy produced by your panels can be used to heat your home and power your appliances, but crucially it can also be sold. The Feed-in Tariff is a rate, agreed when you first get your solar panels, that is paid to you for each kWh you generate. If you produce excess energy and sell it back to the National Grid you can receive a separate rate for that too.

The amount you receive depends on when you take out the tariff and how much energy you generate.

Read more…


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