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SEPCO's blog on all things renewable and green

Are Solar Panels Worth The Cost?

Posted by SEPCO

9/27/12 9:30 AM

Solar Power StationSolar panels carry the potential to deliver profits to installers, but with the acceptance that it will take a long time to see significant benefits. As a long term way of saving on electricity costs, and as a contribution to the environment, solar panels do have many benefits, and should be considered as a way of setting out an investment in clean energy. At the same time, the potential to receive feed in tariffs from the Government make it possible to receive a steady income after the initial cost outlay on solar panels. How much, then, do solar panels cost to install, and what are the benefits?

Costs and Benefits

The initial installation of a set of solar panels is determined by how large you want the panels to be, and how much of an area of a roof they need to cover. Installation costs typically begin at around $3,250 to $5,000 for a basic 3kW system. The more space you cover, the more panels will cost - a 4kW system can set you back $11,000 to $14,000 over a 300 sq ft. area. VAT is charged at a low rate of 5 per cent for installation. Once installed, solar panels hold many benefits.

Solar panels act as photovoltaic cells that create an electrical charge from sunlight, which can then be stored in a generator. This electricity can be used as a backup for the home, with about 2,500 kW generated every year. You can save up to around $800 to $1,300 a year on your electricity bills if using solar powered electricity. At the same time, the Government has set up a feed in tariff, where you receive payments for the energy you produce, and energy that you sell back to the national grid. This is worked out at about 16p per kw. The larger the system, the more energy you produce for your home and as a surplus. The initial cost, plus profits from surplus energy, is typically redeemed after about 20 years, making it a long term commitment.

Other Benefits

As well as producing extra energy from the home, and gradually recouping the initial cost of the installation through feed in tariffs and lower electrical bills, solar panels have significant benefits for the environment. Using solar panels over electricity means that your property will release less CO2 over time. Having backup energy through a solar generator can also mean that you lower the risk of being affected by a local power cut. Solar panels also don’t require regular maintenance, excepting the need to make repairs or replacements to a roof.

Again, it’s important to view the cost of installing solar panels as an investment in the future. You may be able to speed up the rate by which you recoup the cost of your panels as a result of higher electricity bills, with average increases expected to be about 2.6% a year. Earnings from selling electricity back to the grid can also be placed into high interest ISAs to make the most of your savings. In any case, it’s worth discussing how a solar panel installation will benefit your specific home - solar power calculators are available online. Moreover, always check that a solar panel provider is accredited by the Microgeneration Certification Scheme to avoid being sold the wrong panels.

Author Bio: Liam Ohm is a regular home improvement blogger with a passion for windows and blinds. He highly recommends Web Blinds roman blinds for a great range of the latest blind designs.

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