Ashley Seager: Is Solar Better than Savings Accounts?
We've reported many times on the mainstreaming of solar power. We've had posts about Home Depot selling solar panels in its stores, and we've reported recently on the huge growth that is predicted for the whole industry. Of course, one thing that will hasten the adoption of solar, and renewable energy in general, is if consumers can see the financial sense in taking the plunge. This may be starting to happen.
Last September, Ashley Seager, a coloumnist for the UK's Guardian newspaper, reported that solar panels finally made financial sense for home owners. While he acknowledged that pay back times were as much as 15 years still, Seager argued that the return on investment was now better than if you put a similar amount of money into your savings account. Factoring in Government grant money, year-on-year savings in energy bills, and the increase in value of your property, he claimed that returns could be as high as 4.7%, easily beating most saving account rates. Now, half-a-year later Seager is putting his money where his mouth is, and has installed a 3kw solar array on his roof. He took the opportunity to revisit his financial argument for taking the solar leap now.Overall, Seager's calculations still come out in favour of the move, and he argues that his return on investment will be anywhere between 4.1% and 5.5%, depending on whether he can get his hands on a Renewable Obligation Certificate (ROC) which can be sold to power companies who are not producing their legal obligation of green energy. However, Seager also points out that there are still many uncertainties that can work for, or against, would-be solar home owners:
It will also depend on future electricity prices and on whether we manage to keep our lovely old meter, which provides a clear indication of our generation as well as usage. But I don't agree with working out simple "payback" times. The house is now worth more because it costs less to run and is greener than most. The first PV systems, fitted in Japan in 1963, are still running, so they last a long time. Thus the annual return on investment is what matters to us. But people need greater certainty about their "feed-in tariffs" - jargon for what suppliers pay you for the power you supply to them - because the sums only just add up. In Germany the government has mandated tariffs of around 30p per kilowatt hour, compared with between 4.5 and 8.5p in Britain. Small wonder that Germany has 300,000 PV systems compared with Britain's paltry 5,000.
Seager seems also to have cought the energy conservation bug, as he has swapped all of his light bulbs for compact flourescents, and purchased an energy efficient fridge. This, in many ways, highlights the hidden benefit of solar. By changing people's relationship with electricity, and by allowing ordinary citizens to sell as well as consume, it has the potential to greatly improve energy literacy and conservation, as individuals start watching their meters roll backwards. The sooner this happens, the better. ::The Guardian::