Feed-in Tariffs - How to Make Money by Installing Renewables

We are in the final phase of a new build and have, until recently, dismissed photovoltaic as being too expensive and not giving a good enough return. However, the latest feed in tariffs make the whole process much more attractive. I understand that we would not receive the same amount of money if we were to install the system now as this would be counted as part of a new build. If we wait a short while then the system is regarded as a new energy supply and the full tariff that you mention in the article is paid.

I would be interested to know if adopting Economy Seven would have any effect on the tariff or make any other financial impression on the returns? I am looking into this myself but any help would be appreciated by me and, no doubt, other readers of H & R.

The other factor in considering the installation of p.v. is the increase in value that this is likely to add to the property. It all sounds a lot more beneficial and less dangerous than nuclear and much quicker to come on stream at less cost, ultimately, to the country and countryside.

I look forward to reading H & R every month. It has been the source of much help and inspiration in the three years or so that we have been planning and building our new house. I am already looking forward to the next project. I only hope that my wife doesn't read that last bit!

With best wishes,

Nigel Bruce

Whilst a return of 9% sounds attractive, isn't it a bit misleading? Because the initial investment of £12,500 is completely lost. On the other hand, if you stick the £12,500 in a bank account over 25 years, you still have the £12,500 at the end, plus the interest. After 25 years, your solar panels will be worthless.

If you take that into account, isn't the actual profit more like £25k minus £12.5k, and the return more like about 4% ?? And could you really keep solar panels going for 25 years without significant maintenance costs (or even replacement) eating into the profit, and therefore reducing the return?

Would love to be wrong on this. I'm not saying that financial return is the only reason for going green, but we should at least be clear about what to expect.

Mike

This scheme isn't viable because it doesn't cater for what happens when you move house. You only really get the full benefit if you stay in the house for 25+ years, which is highly unlikely, especially for serial self-builders. You might get an increase in the sale price to compensate for the PV system, and you might be able to negotiate that the future payments from the panels go to you, not the purchaser of the house, but don't count on it. Purchasers will expect to get the whole thing for free, rolled into the agreed purchase price, just as they expect to get a new boiler for free: installing a new boiler in my experience doesn't make a blind bit of difference to the sale price. If you try to exclude it from the valuation, they will simply drop their offer and dare you to try and take the panels with you.

The only solution to my mind is the approach used in Ireland, where the capital cost for the PV system is repaid through your energy bills, so the capital cost will be paid by the new owner after you sell, which is fair enough.

I agree with the comment that the Government's grant isn't worth bothering with - you have to use their approved contractors, who have had to go on an expensive course and are looking to recoup their costs. You'd do far better to install it yourself or using a plumber or TV aerial person who is happy to work on roofs. Worcester Bosch say their panels are designed to be installedby any competent plumber - you don't need a specialist.