Solar PV Sales

[moggy1968]

I don't think anyone seriously beleieves that electricity price rises will be in line with inflation. I would judge 8% as a conservative figure. The installation is paid for after 5 1/2 years on my calcs, everything after that is profit.and thats on SAP which is pessimistic (real life experience suggests values up to 30% higher than those calculated on SAP).

It isn't dead money, it has a value. All the experience from germany is that a PV system adds value to a property. Obviously this value will dimish over time but I really can't agree with your figures.

If you put your money in a savings account or high street ISSA you won't be able to buy your motorbike either!! If, however your matress index liked your money you would still be able to buy your motorbike. No other savings you can invest in is index linked, Solar is the best return you can get, by miles. Your investment will only go up and never go down, have you ever heard that for any other investment?

 

[FB.]

A 4kw system isn't 11k anymore

I chose £11000 because the post to which I was replying mentioned a 22% return on last year's prices - but let's call it £8500, to make it look as attractive as possible.

Re-run the numbers:
Have you taken into account that the money spent on the panels will never be recovered, unlike if the money was put into the bank?

How can you be certain that energy price inflation will be greater than RPI inflation? Wouldn't it be fairer to assume that both will be similar?

In today's money terms, a 4kWp system might be as follows:

£8500 installation cost.
3200kWh generation per year.
£1386 FiT payment (£672 if 21p)
£50 export payment.
£216 savings on annual electricity bill, assuming 50% of generated power is used.

£1386 + £50 + £216 = £1652 p.a. of annual gains (excluding provisions for a new inverter and labour charge after about 15 years)

or, if 21p FiT: £672 + £50 + £216 = £938 p.a.

£1652 x 25 years = £41300 of earnings (43p FiT).
£938 x 25 years = £23450 of earnings (21p FiT).


Turning £8500, with 43p FiT, into £41300 is a 6.5% rate of return (excluding any repairs).
Turning £8500, with 21p FiT, into £23450 is 4.1% annual rate of return (excluding any repairs).

 

[moggy1968]

I would refer you to my post above on all your points!!
maybe you should apply for the job as a salesman, your really selling it to me!
Makes me wonder why you ever got involved in the industry if it's such a dead duck!!!
even if I remove the initial purchase price (I allowed £10990) and assume nothing for increases in fits due to rpi it comes out at £880 a year annualised over the lifetime of the system, which is about 8%, but clearly thats nonsence because you do get rpi related increases and these have to be taken into account to give a realistic figure of expected returns.

 

[FB.]

I don't think anyone seriously beleieves that electricity price rises will be in line with inflation. I would judge 8% as a conservative figure.

What about if our current economic recession (depression?) lasts for another ten or more years - like Japan after their bubble burst?
What would be the demand for power from businesses, or cash-strapped (unemployed) consumers?
What about the drive for ever-more-efficient appliances?
What about downward pressure on electriicty prices if we have a mass roll-out of nuclear power? Nuclear has a lower generation cost per kW than gas, oil or coal.

If there happened to be less demand for electricity, or an abundance of cheap supply, why shouldn't prices theoretically come down? Supply and demand, no?

In life, I've learned that just as we assume that the past (good or bad) will continue into the future, suddenly everything changes.

 

[FB.]

Makes me wonder why you ever got involved in the industry if ity's such a dead duck!!!

I'm a scientist.

 

[moggy1968]

that doesn't answer the question, being a scientist isn't a reason to get into selling PV
This coutry currently has a serious energy deficit, meaning we have to import electricity and we have power outages in industrial high energy users. Our coal fired power stations are nearing end of life. Our nuclear power stations are nearing end of life. The world resources are diminishing. Energy is becoming a scarce resource, which means prices will rise. Even if your slightly odd fantasy world we do have over production the monopoly of the energy companies means they can maintain high prices to keep their profits going up and their shareholders happy.
recession or not, prices will rise, they will rise above inflation and anyone suggesting otherwise has, to be honest either lost the plot or has an extraordinarilly poor concept of basic economics!

 

[FB.]

that doesn't answer the question, being a scientist isn't a reason to get into selling PV
.
recession or not, prices will rise, they will rise above inflation and anyone suggesting otherwise has, to be honest either lost the plot or has an extraordinarilly poor concept of basic economics!

I am not a seller of PV, nor do I intend to get into the PV industry in the forseeable future; I am early-retired scientist who made most of his early retirement possible by spending spare time as a financial speculator - usually by taking the side of the trade which nobody else wanted. My concept of economics is sound.

Nuclear is fairly cheap - although not green. But you only have to look at Europe and the UK's slashing of FiT's in recent weeks to see that being green soon gets thrown out the window when the costs start to mount up in tough times. The big energy companies are queuing up to build nuclear stations (which will take several years), if only the government will clarify the rules of the game.

Here's a chart of US retail electricity prices (not UK, but it shows my point):
Electricity+Prices+History.jpg (image)

What's to say that - just as the sharply-rising fuel costs of the 1970's gave way to the stability of the 1980's and 1990's - that we perhaps aren't too far away from another period of stabilising prices?
In the 1950's, 60's, 80's and 90's, electricity prices didn't run away at much higher rates than general inflation - and in some years electricity prices went up less than general inflation.

The 2006 spike preceded the banking and economic crisis - just as the 1973 spike also preceded a banking and economic crisis. The connection? Interest rates too low for too long, causing bubbles in everything that speculators could lay their hands on, using borrowed money. Probably, as in 1980 (which was a few years after the 1974 meltdown), we're soon to see another spike and then it might well become a downtrend or stability for another 10-20 years. Oil plummeted from $50 in 1980 to $10 by the millenium as high prices in the 1970's brought huge investment (and ultimately overcapacity which crushed prices).

But who, in the troubled times of the late 1970's, would have believed that within several years, the soaring energy prices would give way to stabilty.

Anyway....I'll avoid taking this topic any further off-track and we'll have to agree to disagree on this one. :45:

 

[moggy1968]

As this is the solar installation section of an electricians forum, as against a general forum for all comers or for financial advice or speculators that would seem like a good idea.

 

[Gavin A]

What's to say that - just as the sharply-rising fuel costs of the 1970's gave way to the stability of the 1980's and 1990's - that we perhaps aren't too far away from another period of stabilising prices?

The inevitable ongoing decline in North Sea gas output, increased reliance on more expensive LNG imports, and the vast majority of our newest generation capacity being gas fired.

 

[SolarCity]

there was a picture asside the article, a very elderly couple (80+) in a bungalow, you might as well just go out and mug elderly people on the street, it's a disgrace.

I couldn't agree more.

 

[SolarCity]

The economy needs salespeople as much as industry needs people to sell stuff for them.

I don't see it.

All a salesperson should be doing is showing a customer what a system can do. And then leave the decision up to the customer.

Not everyone can sell, I certainly couldn't wire up a PV system.

But what does a good salesperson do that a bad (in terms of succesful sales) does not?

Either a customer wants the system or they do not. When I go to the supermarket, I don't need someone following me around telling my that I really ought to buy a tin of tomatoes.

I can tell from your posts that you are an ethical salesperson, Somecamel and a credit to the industry but this industry is riddled with salespeople - utterly riddled. Some of lies and pressure that have been inflicted on our potential customers is disgraceful and I genuinely wonder how some people sleep at night.

 

[FB.]

As this is the solar installation section of an electricians forum, as against a general forum for all comers or for financial advice or speculators that would seem like a good idea.

OK, I will stop posting - but your unwelcoming reply doesn't come across very well as a representaive of the industry.
The solar/renewables industry needs all the friends and support that it can find - wherever they may be in society. I was a supporter, but your hostile reply isn't doing much to make me sympathetic to the industry.
Until you pressed me on what I do/did, I was just another ordinary member on here who hadn't been troublesome (and I told you the truth; I could have lied to keep the peace).
You never had a problem until - as I said in an earlier posting; I tell people what they *need* to hear, not what they want to hear. It often makes me unpopular, but at least I can sleep well.

Regards - and goodbye,
F

 

[Somecamel]

A good salesperson won't just be in it for the first sale for a start. We build relationships.

It has often been said that a person buys the person that is selling the product.

I'm sure many of you on here are more than capable of 'selling' a system to a customer but believe me there are many others that shudder at the thought of having to talk to them.

Sales people have a place in most lines of business and we're not all bad people.

My worry is much as yours is. The double glazing style of sales has been creeping into the Solar since it's inception back in the Solar Thermal days and the industry received a hell of a lot of bad press back then.

I'm hoping that the new MCS rules that state the MCS registered company can be the only one to sell a system will get rid of some of the parasites.

Now I'm sat here refreshing the DECC site for the announcement that is already half hour late

 

[trevor79]

Think there is a few of us doing that!

 

[finchy]

yes me too !With regard to Sales that all new to me and learning fast, upto December most work was referral and the systems sold them selfs. We have tried leaflet drops, local press and Stand in local DIY all at End of Jan. only 3 leads which as yet have booked a survey. All our current jobs are referrals again. Its a difficult sell going forward, targeting the right people is key, we have a 99% success rate in all our quotes. So for us its getting through the door, but with all this current uncertainty its making things so hard !