Solar Panels: Are They Worth It?
- Solar panels are worth it based on prices dropping 28% since 2014
- Make a profit of £8,500 on combined savings and SEG income
- VAT on PV panels has been scrapped (from 5%) for five years
The price of solar has reduced drastically over the years. Previously, you could buy a PV system for over £20,000, whereas an average 4kWp array would now only cost around £6,000. In this way alone, you could say that solar panels are worth it. Being cheaper now than they were 10 or 20 years ago helps you generate your own renewable energy more affordably.
This article will discuss the benefits of solar technology and how you can answer the question, “Are solar panels worth it?”. From the way VAT has been scrapped, making them a little more affordable, to how you can make money from them through exporting energy to the grid, this article has it all. Naturally, there are also factors to consider before you install them.
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Main Benefits of Solar Panels
To prove that solar panels are worth it, you just have to look at their main strengths. From how much cheaper they’ve become to how they can reduce your energy bills, it’s hard to fault a PV system.
Perhaps the best proof that solar panels are worth it is that you can receive money for exporting unused electricity to the grid. The Smart Export Guarantee (SEG) gives you money from your licensee for every kWh you export. Rates can be set fairly competitively, but any large company with more than 150,000 customers needs to offer a rate above £0.
You won’t be exporting energy all the time, but on average a home will earn around £160 a year through an SEG tariff at 12p/kWh. Higher rates exist on variable terms, which can give you better earnings, and higher fixed rates also exist. However, some of the best rates are reserved for an energy company’s own customers, so you might need to change suppliers to get the best deal.
Reducing Electricity Bills
Whether you’re just installing PV panels as they are or incorporating a battery into the mix, you will instantly benefit from cheaper energy bills. Using PV panels throughout the day can supplement your usage as you’ll use electricity as it’s being generated. With a battery system, anything generated can be stored for later use, eliminating your need to import electricity from the grid. Are solar panels worth it? They can reduce your bills, so they are.
In a bid to make purchasing low carbon technologies and renewable systems, VAT was scrapped on various products, including photovoltaics. Until April 2027, VAT has gone from 5% to nothing, helping homeowners receive PV systems for less. It’s estimated that this could reduce their prices by £1,000, meaning solar panels are worth it even more now.
No Price Fluctuations
Relying on the national grid and energy suppliers leaves you susceptible to price shocks, hikes and fluctuations. As we saw through the energy crisis after the pandemic, the global supply of electricity can skyrocket, leaving vulnerable households much worse off. Solar panels are worth it because they help you through these fluctuations. If most of your electricity comes from your PV system, you won’t suffer from these extreme price shocks.
Once a PV system is installed, it will only save you money. Monthly outgoings continue to rise, but supplementing your electricity or using a solar battery can offset at least some of these costs. Are solar panels worth it to stop paying higher energy bills? Of course they are.
Lifespan and Longevity
While these panels are expected to have a useable lifespan of around 25 years, they can still operate for 50 years – double this length of time. Warranties usually last for 25 years, but the cells gradually lose efficiency over time as they are in the elements every single day. Despite this, solar panels are worth it.
With a warranty guaranteeing a minimum level of output across the decades, the manufacturer will repair or even replace any panels that aren’t performing correctly. Are solar panels worth it? With a lifespan of more than 50 years, they absolutely are. Even half that time frame is beneficial.
Some big expenditures need to be looked at frequently, like a vehicle needing new tyres, an MOT or service. Solar panels, on the other hand, continue to perform without needing any extra input from you. Though they will get dirty over time, solar panel maintenance is only a minor job.
It could be argued that the most efficient solar panels are worth it. Take a look at the best solar panels in 2023 to give you an idea about what’s on the market today.
Will I Break Even on Solar Panels?
Some homeowners often talk about the payback period for solar panels, and whether they will break even. As the initial cost can seem high, they may ask the question: “are solar panels worth it?”. While very few people will look at the payback period for everything they buy, it’s worth exploring how long it takes to offset the price you paid.
There are many factors that need to be taken into consideration with the amount you’ll save with solar panels. These normally involve calculations for money saved on electricity bills and combined earnings from the SEG, as well as what you paid for your PV system. Although it’s possible to shorten the payback period, an average home will take less than 14 years to break even, meaning solar panels are worth it. This would still give you 11 years’ of additional use within a 25 year warranty.
You can see rough calculations for how much different types of home will make across 14 years in the interactive graph below.
A one or two bedroom house will make around £2,200 through exporting solar energy. Three bedroom houses will see at least £3,700, while a bigger four bed will make around £5,100. With savings like these, solar panels are worth it.
Looking at it a different way, you can make a profit of £8,500 on combined energy bill savings and SEG income across 25 years. This will easily pay back the cost of solar panels in the first place.
Are Solar Panels Worth It?
If the benefits outlined above haven’t convinced you, you can be sure that solar panels are worth it based on how environmentally friendly they are. Clean energy will always outweigh that generated through the use of fossil fuels. As solar arrays make use of the renewable source that is the Sun, no exhaust emissions are produced at any time throughout the process.
According to Energy Saving Trust, an average home will save around 1 tonne of carbon a year by installing solar panels.
The graph below indicates the total number of renewable installations registered with MCS. Of the 1.7 million renewable installations registered with them, more than 80% are PV. This proves that solar panels are worth it as they’re based on tried and tested technology.
Are solar panels worth it if they can affect your property value? They are, because installing them is only likely to increase what your home is worth. By increasing the positive environmental impact and decreasing energy bills, they offer positives that homebuyers can rely on.
Some sources estimate that solar panels are worth it because they increase your home value from 4–14%. This can easily help you recoup the costs incurred from installing them in the first place, although they do offer genuine useable benefits that you can make use of. As long as they are professionally installed by MCS accredited installers, you will appreciate the system to install solar panels on your home.
When is a Good Time to Invest in Solar Panels?
The sooner you invest in solar power, the sooner you can take advantage of their benefits. On average, since 2010, the price of solar panels has dropped by 88%. This means that there’s never been a better time to install a solar panel system.
Just because they’re cheaper, does this mean solar panels are worth it? It does, as the less you pay, the quicker you’ll be able to have the system pay for itself.
If you’re wondering how many installations the UK has made over time, you can see the numbers fitted last year in the interactive graph below.
Start Your Solar Journey
Are solar panels worth it based on the information outlined above? They absolutely are. Despite being a significant investment, the payoffs are huge. From saving you money on your energy bills to making you money through exporting unused electricity, you’re sure to benefit from a PV system. Just make sure to understand the pros and cons of solar panels first.
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