Solar Panels Still Make Financial Sense

Despite the sharp reduction in government subsidy rates that took effect at midnight last night, the Solar Trade Association (STA) state that a domestic solar installation can still deliver tax-free rates of return of 5% under the new tariff.

Paul Barwell, chief executive of the STA, acknowledges that the cuts in tariff were excessive and counterproductive but that solar still represents a good investment for householders.  He states that

“Solar technology is exceptionally reliable and attractive and the solar industry has proved itself to be the best energy sector in the world at bringing costs down and developing innovative products”

Our own calculations suggest the following

A current 4kW domestic Solar PV installation financial example;

  • System generates in the region of 3,500kWh a year
  • Generation payment tariff of 4.39p/kWh
  • Export payment tariff of 4.85p/kWh
  • Electricity savings of £225

Totals approximately £460 a year which equates to a return on investment of up to 9%  

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