What are the financial benefits of solar energy?

What are the financial benefits of solar energy?

Solar energy involves converting energy from sunlight into electricity. Solar panels consist of layers of semi-conducting materials, which create a flow of electricity when in direct sunlight. Solar photovoltaic (PV) systems are made up of multiple panels, each generating around 355W of energy in strong sunlight.

Solar energy is one of the most sustainable and inexpensive energy sources, which is why more and more homeowners are installing solar panels in their homes. In fact, the residential interest in solar energy is rising by around 16% each year. With the ongoing energy crisis due to the war in Ukraine, renewable power is set to break records in 2022.

There are many advantages and financial benefits to converting to solar energy, which is why it is growing in popularity in countries like Sweden, where the International Renewable Energy Agency aims to rely on 100% renewable energy by 2040.

Learn more about the financial benefits of solar energy and where you can find solar panels for installation across Aldershot, Kingston, Guildford, Ascot, Hampshire & Surrey.

Reduce Your Energy Bills

One of the greatest financial benefits of solar panels is that they can save you money on your energy bills from the moment you have them installed. You can use the energy you generate as soon as your solar panels are up and running, so you will not have to use energy from the national grid.

Energy Saving Trust estimates that for a typical household with a 4.2 kilowatt system, you can save between £165 and £405 per year on your energy bills at current energy prices. Of course, sunlight is free, so you can start saving straight after the initial cost of installation. You can find out how much you could save by using the Solar Energy Calculator.

Another way to reduce your bills is to use solar batteries, which allow you to store the energy that your solar panels produce so that you can use it when there is not enough sunlight to generate energy. Whilst this is a relatively new solution, it is becoming more effective and affordable.

Get Paid For Energy You Don’t Use

In January 2020, the Government introduced the Smart Exports Guarantee (SEG), which stated that households would get paid for exported solar energy. Essentially, this means that if you have generated more energy than you are using, the surplus can be contributed back to the national grid, and you will be paid for it. After all, most households only use around 15% of the energy they generate.

It was introduced to provide financial support to small-scale renewable energy generators for the energy they export to the national grid. Under the SEG, electricity suppliers offer payments for each unit of power that is exported to the grid. You can switch energy companies when you have solar panels, provided that they are eligible suppliers. Find out who offers the best deals here.

Recoup The Cost

The cost of an average 4.2 kilowatt solar PV system is around £6,500. Whilst this is not insignificant, the Energy Saving Trust claim that most homes will recoup the costs of their systems between 16 and 22 years with SEG payments.

Of course, there are many factors that contribute to whether it will take more or less time to break even, for example, depending on how much electricity you use and when you use it, and how much you are paid under the SEG. 

The positive thing is that solar panels can for 25-30 years, and they can last much longer based on the systems degradation rate. Generally, solar panels have a degradation rate of 0.5% on average per year. This means that your system can still operate at around 88% capacity after 25 years.

Increases The Value Of Your Home

Another benefit of solar panels is that, due to their growing popularity, they can increase the resale value of your property. Solar panels also improve your home’s energy performance certificate (EPC) rating, which increases its overall value.

ING Direct conducted a survey which found that they are one of the most desired additional features of a property for sale. This is supported by a recent Trade Body Solar Energy UK report, which found solar panels could increase resale prices by at least £1,800.

This mainly benefits homeowners who are not looking to sell for around 20 years, or else you will not recoup the cost of the initial installation.

Solar Panels For Your Home

If you have any further questions about solar panels, please do not hesitate to contact Jewel Renewals, and a friendly member of our team will be happy to help.

You can contact us directly by calling 01252 939 597 or filling out our online contact form, and we will get in touch at a time that suits you.