Pay back times

[Potential Power]

Can any of you guys that are already installing please give me some guidance on the sort of payback time you are calculating versus system size.

I am getting some wild figures for some systems, so would like to work out a rough average.

 

[smiffy_99_uk]

Do you mean payback againt install costs?

 

[Potential Power]

That would be useful too, but what I meant is the payback that people are calculating to the customer in years. ie how long it takes the FIT to pay the cost of the system. I have quoted someone for a system and they are saying the payback time is too long at 9 years !!!!

 

[BruceB]

Inflation proofed payback time of 9 years is an 11% return on investment tax free for domestic customers. Given that if you have capital lying around in a bank then the return is negative after inflation at the moment, then putting spare money into pv on your house is a no-brainer. If your customers do not understand that then they are not the sort of people who will have the money available!
Regards
Bruce

 

[TheMightyGusset]

Inflation proofed payback time of 9 years is an 11% return on investment tax free for domestic customers. Given that if you have capital lying around in a bank then the return is negative after inflation at the moment, then putting spare money into pv on your house is a no-brainer.

^ This !^

Assuming inflation at 0% most 3.9Kw systems should pay for themselves in 10-12 years, if we get any inflation at all, and if electricity bills go up (unlikely as that sounds !!!!) then the payback time will be reduced.
Also, as is being discussed elsewhere, as take up of solar PV increases, then the FIT tariff for new customers will reduce.
There is no better time to fit solar PV than the present.

 

[Potential Power]

Guys thank you for your comments. Those are the sort of times I am coming up with, and yes I totally agree with all you have said.

The one customer I had spoken to regarding this I think was looking at this in the short term rather than the long. I explained all that you have above, but then started questioning if my ROI times were similar to what others were coming up with.

Does anyone have any clear idea if fitting PV on a property increases the value of the property. One estate agent I spoke to did not really want to commit to if it did or didn't, I think because it is only just coming into our area.

 

[TheMightyGusset]

Ask yourself this question :
If you were looking at three identical properties, one with no solar PV fitted, one with a 'free' install, where the FIT payments go to the Utility Co., and one where the FIT goes into your pocket, which one would be the more attractive ?
While you might not want to pay much more for a house with solar PV fitted, but it'd be a more attractive proposition, so more likely to sell at the asking price.

 

[VMan]

I trying to put together some calcs on a spreadsheet to give me ROI and cant get my head around it all,
can i ask where payback time of 9 years = 11% come from?
Cheers

V

 

[BruceB]

ROI = 1 / payback period

It is one of the mandated calculations if you look at the REAL documentation, where they lay out the way you should present this to customers.

Regards
Bruce

 

[VMan]

ROI = 1 / payback period

It is one of the mandated calculations if you look at the REAL documentation, where they lay out the way you should present this to customers.

Regards
Bruce

Ahh right oh, i have been using Ar = Vt/Qp which is giving me the same result.

 

[Guest 004]

yeah payback is 10 - 12 years, and by then they will need replacing, just look how batteries have gone over the last 20 years!
to me just not viable

 

[TheMightyGusset]

Solar panels should easily last 30+ years.
Yes, there will be some degradation, and performance will tail off over time, perhaps to as low as 70% of their maximum efficiency, but as they'll have more than paid for them selves, who's going to care ?
Some of the earliest Japanese panels are still going strong 40+ years later.