How Much Can I Really Save With Solar PV
How Much Will It Cost?
Solar PV panels have come down by about 10 per cent compared to last year, and a typical solar PV for a standard home would cost upwards of $6000 for a 6.6 kWh system with 21 panels.
If you want to add battery storage, this will double or even triple the price of the system.
Prices for storage start from $6000 for entry level, compared to the trendy Tesla Powerwall 2.0, which will cost at least $11,000. However, with those entry level systems, don't expect them to last very long. Go here for more details on cost of a solar PV.
How Quickly Will It Pay Itself Back?
With solar PV system, battery storage or not, it's all about the investment. The time that it takes for the system to pay itself back based on potential electricity bill savings is known as the payback period.
This can vary depending on which state you are living in, how expensive the electricity is (from your retailer) and what kind of quality system you install.
At the time of writing, batteries can cost double or even triple the price of getting solar panels installed. Not only that, most are not reliable enough to even pay $5000 for. We recommend taking your time to install storage. By adding storage, your payback period could be at least 15-20 years, for example, savings with a typical 6kwh storage unit is approximately $500 a year.
If you do not include battery storage, a five-year payback on a solar PV system that can last about 20 years is a significant return on your investment.
Where You Live Makes a Difference
A system will pay itself back quicker for those living in Adelaide because power is so expensive there.
Solar Choice (solarchoice.net.au), a solar comparison and brokerage service, said it was important for people to chose a solar system that is the right size for their home, so that they are using at least half the energy it produces directly.
If this is the case, it found payback for most cities could take less than seven years. For those living in Adelaide, Brisbane, Perth and Sydney, they generally take less than five years to pay off their solar systems (see table below).
How Much Will You Save?
The exact amount you will save will depend on how much electricity you use, what time of day you use it, how large your solar PV system is, whether your house roof has some shade from trees or neighbours dwelling, what direction your roof faces, whether you get a battery installed, and whether you also install intelligence software to maximise your savings even more.
Truth be told! You will find this out exactly when the solar is installed and operating throughout the years.
So What's The Catch And Will I Save?
To answer this question practically: do not install a solar PV system for your home just because it is cheap and convenient. Unless is makes a difference to your current energy bill by at least half, then don't bother putting it on your roof. A good quality solar PV system today should last at least the next 20 years producing the planned electricity it was suppose to do. You do not have to look after it day in day out like your car. It does however, degrade ever so slightly over time. And you must factor this in when choosing the system.
Unless you have a battery, solar panels only provide electricity when the sun is out so if you are at home and using your appliances a lot during the day, you will get more out of your panels, and therefore savings.
If you are at work all day then you won’t save as much, because you won’t be using that free electricity during the day, and will still need to access the grid at night for your energy needs.
Some people run their pool pumps, washing machines or other powerful appliances during the day to maximise their use of solar electricity, but to get the most out of the system, it’s a good idea to also run water heating, or space heating and cooling during the day.
For those who can't be home during the day, you can also look it at in a different way. Put in a big enough system up there on your roof, to produce enough excess energy to sell back to your retailer so that it covers your night time use. For example, this is a typical day in Sydney for a 5kw solar PV system household of two adults and two children.
As can be seen in the two graphs (Figs 1 and 2), the solar produced and exported back to grid is 11.3 kwh (green bars). The yellow bars represent grid use, which is 9 kwh from 12am-7am, and from 4pm to 11pm it is 6.2 kwh. Overall in 24 hours on Sunday, the household had a net reliance grid use of 3.9 kwh resulting in $1.88 bill to the energy retailer. This bill also includes daily supply charge.
Without the 5kw solar PV system, this household would have used 19.2 kwh from the grid, and paid $4.97 to the energy retailer.
What's important to understand and it's not shown here is that in the graphs it does not show how much solar electricity that was generated and used by the household during 7am - 4pm. You would need to connect to the inverter see this data.
Therefore the actual 'real' savings from the solar PV for this household on this day would be,
($ or kwh) Solar Electricity used + Exported Back Grid
We include the export back to the grid component because what you don't use you put back into the grid, and it can be carried over to your next bill cycle. That is part of your savings.