Solar panels: Power that pays for itself

From next month, the Government will pay for home-grown electricity – so installing solar panels won't just ease your eco-guilt, but make real financial sense. Jonathan Christie sheds light on a real green money-spinner

Ronald and Wendy Jordan are hoping the latest addition to their Cornish beef farm will be the most exciting yet. It's out in the lush meadows that surround their farm near Lostwithiel, but is unlikely to be grazing with the herd as they've recently installed a solar photovoltaic (PV) panel.

Solar panels are increasingly part of our urban and rural landscapes, but the reasons for installing these eco-energy providers is about to become not just environmentally sound—but financially savvy, too.

From next month, Feed-In Tariffs (FITs) will come into effect. They form part of the Government's "Clean Energy Cash Back" scheme, an incentive to move away from conventional fossil fuels to greener energies, with FITs allowing home owners with their own renewable power source to receive money for every unit of energy they generate. If you don't produce enough power for your needs, you can still draw on the grid for a boost, but if you produce more than you require, you can sell it back at a guaranteed rate.

The Jordans are keen to make their farm and its B&B business more sustainable. "We've always had a vested interest in renewable energy," Ronald says, "as an environmentally sustainable way to generate power, so solar panels were the next step towards making our home more energy-efficient and to protect ourselves financially in the future. We're even looking at installing a solar thermal system as well."

They took the plunge last autumn when their 2.2kWp (kilowatt peak) PV arrived on site. The cost of installation was £10,500, but almost immediately, they started to see their bills decrease, and now the solar panels generate most of the electricity used in the farmhouse.

Along with these savings, the new FITs will see them receive between 29.3p/kWh and 41.3p/kWh, which could deliver a tax-free annual income of nearly £1,000, regardless of whether the energy is used or exported back to the grid. Any energy they do export will gain them a further 3p/kWh.

Government figures show that in practice, a household using 4,500kWh of electricity a year could see an income of £750 from energy generated (at a tariff of 30p) and a top-up of £50 for unused electricity exported to the grid. They also quote a saving of £150 on power drawn from the grid as a result of owning a renewable energy source. This gives an annual saving of £950. The utility company and solar energy specialists Npower – who helped the Jordans realise their PV project – estimate that an average domestic PV (between 1kWp and 3 kWp) would start at around £7,500, meaning your investment would have paid for itself after eight years.

And it's not just PVs that will benefit from April. In all, there are five types of green energies that are eligible, all offering at least 10 years of fixed tariffs for their owners. And if you have more than one system – solar and wind, say – you'll be metered separately and gain on both.

But many potential customers will still find the upfront costs beyond their budget. Help is in the pipeline, though, as the Government backs up its figures with a parallel scheme of "green loans" that will be attached to the house rather than the person who took it out. Pay-as-you-save green finance has yet to become legislation, but once in place, home owners will see another common barrier to installing a renewable energy source removed.

It appears the Clean Energy Cash Back scheme has ambitions to stimulate a huge uptake on self-generated energy. Recently, the Energy and Climate Change Secretary, Ed Miliband, announced that 10 per cent of UK homes could be fitted with low-carbon-energy technology by the end of the decade, with hopes of 700,000 solar PV units being installed.

One such urbanite gre who's already signed up is Ismail Patel, who owns a house in Yorkshire. He has 10 panels on his roof, which generate more than two-thirds of his annual electricity. "The panels have been a fantastic investment," Ismail says. "The system works as easily as it did when we were using mains electricity."

Donnachadh McCarthy, who runs the environmental consultancy 3 Acorns Eco-Audits, has been campaigning for more than a decade for the government to introduce feed-in tariffs into the UK. He installed a solar electric system into his London home 13 years ago and has some tips for people wanting to benefit from the new tariffs.

"When installing a system, really try and get every extra panel you can, as a major part of the cost is the actual installation," says McCarthy.

"Ensure that any display dials showing output are easily seen to ensure you are using your own electricity when, for example, you want to run the washing machine on a sunny day. And consider contacting a green finance company like the Ecology Building Society or Triodos Bank to see if they will fund your solar installation."

And finally, he continues, "only choose an installer that is a member of a reputable industry body, such as the Solar Trade Association, and do not pay for the entire installation until it has been commissioned and is working properly. Cowboys exist even in the green market."

Discover more property articles at Homes and Property
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Technical Author / Multimedia Writer

Negotiable: Recruitment Genius: This recognized leader in providing software s...

Recruitment Genius: Clinical Lead / RGN

£40000 - £42000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: IT Sales Consultant

£35000 - £40000 per annum: Recruitment Genius: This IT support company has a n...

Recruitment Genius: Works Engineer

Negotiable: Recruitment Genius: A works engineer is required in a progressive ...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent