Last Updated 8th August 2015

Previous update – 19th June 2014

And see what solar system prices were like back in 2013.

Solar PV systems perhaps (arguably) now represent the best value for money that they have ever been. Plus as the industry has matured we now offer a better quality of system as standard – with LG Solar being perhaps one of the best panels we have ever seen, from a well recognised consumer brand, and as the output increases, the amount of space needed to install a system has decreased. But also the return on the capital is now as good as it has ever been (when the feed in tariff was much higher) – and the capital needed is as low half of what it used to be.

The “payback period” (simply how long does it take for the panels to give you back as much money as you spent) is for a 4 kW “retro-fit” system around 6 years and 9 months – compared to 7 years and  2 months in June 2014. Back in February 2013 (when system prices had reduced) a mid range system would have a payback period of 8 years and 6 months. In late 2011, just before the original reduction in subsidies (the “sweet period” for buying solar panels – there are lots of people very happy to have bought panels “just before they cut the subsidy”) – the payback period was 6 years and 4 months.

However the systems we are comparing are not necessarily “like for like”. We are now using 285 watt LG solar panels – and the comparable system back in 2011 would have been for Panasonic/Sanyo panels – and the payback period for those panels was something like 7 years and 2 months. Plus that system would have cost around £13,500 – compared to around £6000 for the same quality of solar system today. And I would suggest that half of the solar installations installed in 2011 are now not covered by installers warranties (as the installers are no longer in the business!) – judging by the amount of calls we get from people when they have problems (albeit problems are very rare).

So you will not only get your money back quicker – you need less than half the same amount of money as you would have needed 4 years ago – to get the same quality of solar panel system. So to all the slightly smug “I bought it at just the right time” – I would not be so sure. Today may indeed be a much better time to install solar.

All systems are based on a South Facing system angled at 35 degrees and has no shading. Prices are for an installed system, inclusive of VAT and scaffolding for access. For the larger (25 and 50 kW) systems we have used Sapphire Solar 250 watt poly-crystalline panels. We can save some 10% off the costs of the residential systems using “non-branded” panels and inverters ..

On Roof Systems:

Total   System Power System Cost (Vat   Inc) Annual FiT   Payment & Elec Bill Savings Total FiT   Payment over 20 years Annual Return Payback Period   (Years)
2 kWp £4370 £447.88 £8,957.53 10.25% 9.76
3 kWp £5,511 £639.82 £12,796.48 12.52% 7.99
4 kWp £6,072 £895.75 £17915.07 14.75% 6.78
10 kWp £12,045 £2,115.71 £42314.19 17.56% 5.69

In Roof System on new build (scaffolding and VAT excluded):

Total   System Power System Cost (Vat   Excl) Annual FiT   Payment & Elec Bill Savings Total FiT   Payment over 20 years Annual Return Payback Period   (Years)
4 kWp £5742 £895.75 £17,915.07 15.60% 6.41

Commercial systems – using a sheet metal roof, and Sapphire Solar 250 watt poly-crystalline panels (and a 12 degree roof pitch). Scaffolding included. Using ABB Power One 3-phase inverters. 12p per kWh assumed for purchased in power.

Total   System Power System Cost (Vat   Excl) Annual FiT   Payment & Elec Bill Savings Total FiT   Payment over 20 years Annual Return Payback Period   (Years)
10 kWp £11,245 £1,866.39 £37,327.88 16.60% 6.03
25 kWp £24,175 £4,570.65 £12,796.48 18.91% 5.29
50 kWp £45,140 £9,141.29 £182,825.80 20.25% 4.94

Below are the prices for the same systems in June 2014

Total   System Power System Cost (Vat   Inc) Annual FiT   Payment & Elec Bill Savings Total FiT   Payment over 20 years Annual Return Payback Period   (Years)
2 kWp £4,785.48 £464.37 £9,287.36 9.70% 10.31
3 kWp £5,592.10 £696.55 £13,931.04 12.46% 8.03
4 kWp £6,646.76 £928.74 £18,574.72 13.97% 7.16
10 kWp £13,209.60 £2,189.95 £43,798.91 16.58% 6.03
25 kWp £29,262.61 £5,255.04 £105,100.78 17.96% 5.57
50 kWp £54,968.21 £10,510.08 £210,201.55 19.12% 5.23

 

And finally – compared to what the return was towards the end of 2011 (before the initial cut to the feed in tariff – often thought of as the best time to buy solar panels).

Total   System Power System Cost (Vat   Excl) Annual FiT   Payment & Elec Bill Savings Total FiT   Payment over 20 years Annual Return Payback Period   (Years)
4 kWp £11,968 £1,878.65 £37,573.04 15.70% 6.37