Ok, so you’re hearing that Solar is a great investment. What you need to work out is:
- Whether or not it’s a good investment in your circumstances,
- How long it will take to pay for itself before you start seeing a benefit financially,
- How the returns on the initial investment compare to putting your money into shares or even just putting it into the bank at 5%.
- If you’re paying for the system on finance, you want to be sure that the return on investment is quite a bit more than what you’re paying in interest or else what’s the point?
Let’s look at a scenario and we’ll show you how to work out the returns for yourself. Firstly, how much energy will you solar energy system generate. 3.27kW Solar System Cost / Benefit Analysis
- You decide on a 3.27kW system (10 off SUNPOWER E20/327W panels) and it costs you $10,506.45 out of pocket fully installed (after STC & including GST).
- You live in Newcastle where a 3.27kW system produces on average 12.46kWh per day. This assumes a north facing roof with no shade issues.
- The price you currently pay for electricity is approx 26c/kWh.
- You use all of the energy your system generates during the day time and you therefore don’t export anything to the grid. Export percentage = 0%
- Yearly benefit = 12.46 units (kWh) x 365 days x $0.26 x 0% export = $1181.99.
- Payback period = $10,506.45/$1181.99= 8.89 years
- Return on Investment = $1181.99/$10,506.45 x 100 = 11.25% per annum