reduce solar water heater payback time methods to surprise you
Some may say that buying a solar water heater is not reasonable because of its long period of payback time, but today we are about to present some methods to reduce this period that can surprise you.
solar water heater payback
Solar panels are currently selling at their lowest price point since 2010, which means that despite the fact that purchasing them is still a significant financial commitment, the payback period for solar panels may be shorter than it has ever been.
This return on investment will manifest itself in the form of lower monthly power bills and potentially even rewards made possible by the Smart Export Guarantee or the Renewable Heat Incentive. Because of this, the answer to the question of whether or not installing solar panels is still worthwhile now that the Feed-in Tariff has been eliminated is an unequivocal yes.
How much does it cost to buy solar panels?
Before we can even begin to calculate the payback period for solar energy, we need to know how much money is being invested. Solar panels will cost between £6,000 and £7,000 for the typical home in the UK, which is a reduction of almost 60 percent from the price in 2010.
Even if the Feed-in Tariff (FiT) program is coming to an end, the payback period for solar panels may still be lower than it would have been if you had installed them a few years ago.
Both the size of your home and the amount of power you use will decide the size of the solar panel system that is necessary for you, which in turn will have an effect on the overall cost.
| Solar Panel System Size |
Average Cost |
| 1kW |
£1,840 |
| 2kW |
£3,680 |
| 3kW |
£5,520 |
| 4kW |
£6,040 |
To provide some perspective on the systems, a residence with three bedrooms would most likely require a system with a capacity of three to four kilowatts (kW), which will range in price from around £5,520 to £6,040.
As you can see, solar panels are a big investment. Therefore, in order to obtain the most affordable installation price, we strongly advise comparing at least three different estimates. You can obtain free quotations right here on Solar Guide, which will make the process of locating local solar contractors much simpler for you.
Solar panel payback time in the UK
We have utilized our solar payback calculator, a tool that figures out your particular solar payback time based on certain factors, so that you may have a better understanding of how long it might take for you to get your money back from investing in solar panels.
The payback period for solar panels in the south of the United Kingdom
In this particular instance, we have calculated the solar payback time of a home in London that installed a 3 kW solar system, in addition to the following over the course of a period of 20 years:
During the day, the cost of power is 0.1437 pounds per kilowatt-hour.
Over the course of 30 years, the panel's production will decline to 80% of what it was in year 1.
Modifications made to an existing structure (band D or above)
| Potential Solar Return Period in London |
| Investing in Solar Panels |
£4,834.83 |
| Electricity Savings in the First Year |
£187.13 |
| Payback period |
11 years and 4 months |
| Profit during a 20-year period |
£952.26 |
The payback period for solar panels in the northern part of the UK
Using the same set of criteria as in the previous example, but with a roof that faces south in Glasgow, it is possible to make a profit from solar panels over the period of twenty years in Scotland as well.
| Possible Solar Payback Period in Glasgow (in Years) (3kW system) |
| Investing in Solar Panels |
£4,834.83 |
| Electricity Savings in the First Year |
£167.43 |
| Payback period |
12 years and 5 months |
| Profit during a 20-year period |
£230.93 |
This does not take into account any government payment programs like the Feed-in Tariff (which ceased in March 2019) or the Renewable Heat Incentive (eligibility with solar thermal only).
If you had your solar panels placed before the Feed-in Tariff program was terminated in March 2019, then you will continue to receive payments and your solar payback period will be reduced as a consequence.
How to cut the payback period for solar panels
As we've seen, it is very feasible to see a return on your investment in solar owing, in large part, to the savings that are realized on your monthly power bills. You may be qualified for programs funded by the government, which can cut the amount of time it takes for solar panels to pay for themselves. The Smart Export Guarantee (solar photovoltaic) and the Renewable Heat Incentive are two examples of this (solar thermal).
smart export guarantee solar water heater
Over the course of a year, there are approximately 1,493 hours of daylight for those of us living in the United Kingdom (source: Current Results). If we were to break that down, it would come to about four hours per day. With this amount, we will be able to calculate how much you have the potential to make through the SEG on an annual basis.
Suppose you choose the most expensive rate, which comes out to 5.6 pence per kilowatt-hour (correct as of January 2021). You would be able to generate approximately 3,920 kilowatts of electricity using 4 solar panels of 245 watts each every time there were 4 hours of daylight. That comes out to 3.9 kWh, which is equivalent to slightly more than 22 pence each day. There is a possibility that you will make £80.30 every year, which is equivalent to £1,606.50 over the course of 20 years.
In the event that you require a more powerful 4 kW system, with 10 400 W solar panels, you will receive additional money through the Smart Export Guarantee. Over the course of 20 years, the sum of money you earn might potentially reach £3,207. Keep in mind that the initial investment would be significantly more for you.
Examine the Different Tariffs for the Smart Export Guarantee
Get Free Solar Panel Quotations: Get quotes and compare rates.
Incentives for the Use of Renewable Heat
Those who qualify can get money from the government for the heat that is generated by their renewable heating system if they participate in the Renewable Heat Incentive program.
In terms of solar energy, this refers to the installation of a solar thermal system. This type of system harnesses the power of the sun to heat water, which may then be used to power the building's radiators and hot water faucets.
Adding a solar battery to your investment is a smart move.
If you install solar batteries in conjunction with your solar panel system, you will be able to store any excess solar energy that is produced during the day (and there is a good chance there will be a lot of it) in order to put it to use once the sun has set. If you do not have a solar battery, then the energy supplier will have to supply all of the energy needed during the nighttime hours. This will result in a further reduction in the amount of money you save on your energy bill.
However, solar batteries do have a cost, and that cost may range anywhere from £500 to £8,000, depending on the brand and type.
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