Income & Returns
Typically in our region a well sited 4kwp (kilowatt peak) Solar PV system will require about 24m2 of space and can generate in excess of 3500kwh/year of electricity. Exact output depends on the efficiency of the PV panels chosen, location, shading, pitch and orientation to south.
Annual earnings on such a system would be approx:
- £540.40 in tax-free FIT income (Property with an EPC of D or above)
- £315.00 in savings on your bill through use of your own free electricity
- £81.20 in export income from power sold to the grid
- £936.60 in total savings per year
- £5499.00 inc VAT, fully fitted from price for a typical system
The ‘Feed in Tariff’ means that all power suppliers are obliged to pay Solar PV owners a set rate per unit (kwh) of production for 20 years for ALL their Solar PV power. Even better, having been paid for ALL the home produced power you can then use your free electricity on-site and automatically export any excess to the grid, so you will always be earning in daylight hours. This income is tax-free for domestic PV. FIT rates vary according to the size of the array and whether it is used in conjunction with a buildings existing supply (generally the case) or in a ‘stand alone’ situation.
Below are the rates paid for each kilowatt-hour of electricity produced on properties with an EPC of level D or above:
|PV Size||FIT (pence)|
These FITs will be paid for 20 years from the commissioning date of the system and are locked-in to the initial rate (indexed linked to the RPI to protect them from inflation) for the entire period. Furthermore the payments are tax-free for domestic properties. The initial rates may be reduced for new entrants to the scheme therefore it is advantageous to adopt Solar PV sooner rather than later.
The benefit to the customer is not only in the FIT payment received for each kwh of production but also in the saving made by not having to purchase the equivalent amount of electricity produced on-site from a power supplier. For example, a customer adding a PV System (0-4kwp) to a house in March 2013 would benefit from the saving made on their existing bills by generating their own electricity rather than buying in that power, at for example 15p per unit, and would also benefit from the FIT which is worth 15.44p per unit. So the total benefit of the PV electricity used on-site is actually 15p + 15.44p = 30.44p per unit (kwh) of production. It is estimated that in a typical home 60% of PV generated electricity is used on-site with a guaranteed 50% being automatically ’deemed’ as exported to the grid earning an additional 4.6p kwh.
The government has stated that electricity prices will rise significantly over the coming decade (http://news.bbc.co.uk/1/hi/business/8297882.stm), with evidence of this over the last 2 to 3 years, and as these prices rise the benefit you gain from your own PV generated electricity will rise too.
Not all the financial benefits are realised on electricity production or use. PV systems add value to a property at they contribute to a higher EPC (Energy Performance Certificate) rating, as buyers will reap the rewards of the income generated and the reduced energy overheads. Furthermore, there are significant environmental benefits from producing your own clean energy and if requested we can detail the impact of this in terms of CO2 savings when we offer you a quote for a PV system.