I'm thinking of these solar panels that people have on their rooftops in domestic properties. I suppose I mean after how long do you break even with respect to just carrying on without them and getting you electricity from the utilities companies? Or answer in any way you think is pertinent. The more info the better.
It's generally stated that it takes 0 years for them to pay for themselves. But the concept of paying for themselves is a primitive concept used by those who do not understand finances. You're still losing money when it pays for itself. A more appropriate analysis would be the Internal Rate of Return calculations, Excel makes this calculation easy. Overall,?solar power?is expensive power and works out about 38 cents per kwh ( proper economic estimates typically place it between 23 cents to 45 cents per kwh ). Some idiot here will insist solar doesn't cost that much per kwh, it does unless you're uneducated in finance. Note, it's also not clear if the energy produced by?solar panels?exceeds the energy required for their manufacture, delivery and installation. It takes a lot of energy to melt silicon and the costs triple if you try to recycle the toxic wastes which is why the panels are made where it's still possible to dispose of the toxic wastes. They could very well be causing more environmental damage then they save. With the Europeans what happens is the feed in tariffs makes the solar panels worthwhile. They still don't really pay for themselves but they allow you to take some of the tax money from your neighbors, a bit of an ethical dilemma really but ethics never stopped Europeans.
Why pay thousands of dollars for solar energy ($27,000 average cost) when you can build your own solar panel system for just a fraction of the retail cost. You can build a single solar panel or you can build an entire array of panels to power your whole house. Some people are saving 50% on their power bill, some people are reducing their bill to nothing. But what’s most impressive is that just by following these instructions some are even making the power company pay them!
Hi Warne, Payback period of solar panels depends on three main factors: ) Amount of solar radiation available: the more solar resource available at a site, the shorter the payback period will be. The insolation level is a function of latitude, cloudiness, elevation and some other factors. 2) Availability of grants, incentives and tax credits. Reducing the initial cash outlay is a great way to speed up profitability. For example, in the US, the 30% federal tax credit greatly reduces the payback period as it puts some of the cash back in your pocket in a short amount of time. Minimizing the initial cost has a big impact, since money in your pocket today is always worth more than money down the road. 3) Net metering or feed-in-tariff. If you are able to sell back your excess power, or all of the solar electricity to the grid, then you can also improve the payback period. Feed-in-tariffs are not very common in North America, but net metering is an option. Investing in energy efficiency measures (e.g., LED lights) at the same time as solar may help generate more excess power and help with the bottom line. There are some online calculators which may help you put all these together for a specific site. I'm including a link below.
The payback period for a solar PV installation is based upon the cost of the installation compared to the savings achieved. Therefore if you installed a modest set of panels yourself, did not need on site electrical storage and did not have any permitting fees but did enjoy rebates you would be doing better than if the installation costs were high, the solar equipment was expensive, you had to purchase storage batteries, it was costly to maintain and permitting was absurd. On the other side of the equation if your electrical use is high, you perhaps own an EV or you can sell power at a high rate then the costs you will be offsetting will be higher and the payback period will be lower. If your electrical use is minimal, there is no time of use metering available the payback period will be higher. Some of the costs you may be offsetting may not be electrical. If you concurrently purchased an EV then you may be offsetting the cost of gasoline which would be higher than electricity. Overall rebates and incentives play a major role. I have seen payback periods as low as 3 years claimed (commercial installation with special city tax breaks) and as long as over 20. A bell curve would probably find most of the installations in the 7 to 5 year category. A solar thermal installation (for hot water, heating and sometimes AC) is far more efficient and most would be in the range of 2 to 8 years.
