Solar panels are an increasingly popular way for homeowners to generate their own electricity and reduce their reliance on the grid. In the United Kingdom, solar panels have become particularly popular in recent years, thanks to government incentives and falling installation costs. But how exactly do you make money from solar panels? In this article, we’ll explore the different ways in which solar panel owners can earn money from their installations.
Feed-in Tariff
The Feed-in Tariff (FIT) is a government scheme that pays homeowners for the electricity they generate from their solar panels. Under the scheme, homeowners are paid for every unit of electricity they generate, regardless of whether they use it themselves or export it to the grid. The FIT rates are set by the government and are adjusted every three months to reflect changes in wholesale electricity prices.
The FIT scheme was introduced in 2010 and has since paid out billions of pounds to solar panel owners. However, the scheme closed to new applicants in April 2019, meaning that only those who installed solar panels before this date are eligible to receive payments. If you installed solar panels before April 2019, you can still earn money from the scheme until your installation reaches the end of its 20-year lifespan.
Export Tariff
In addition to the FIT, solar panel owners can also earn money from the Export Tariff. This scheme pays homeowners for any excess electricity they export to the grid. The rate paid for exported electricity is set at a fixed rate of 5.38p per kilowatt-hour (kWh).
The Export Tariff is available to all solar panel owners, regardless of whether they are eligible for the FIT. However, unlike the FIT, the Export Tariff is not guaranteed for the full 20-year lifespan of the installation. Instead, it is reviewed every year by the government, and the rate paid can change depending on wholesale electricity prices.
Self-Consumption
Another way in which solar panel owners can save money is through self-consumption. This involves using the electricity generated by the solar panels to power appliances in the home, rather than exporting it to the grid. By doing this, homeowners can reduce their reliance on grid electricity and save money on their energy bills.
To maximise the benefits of self-consumption, homeowners should try to use as much of the electricity generated by their solar panels during daylight hours as possible. This can be achieved by timing the use of appliances such as washing machines and dishwashers to coincide with when the sun is shining.
Energy Savings
Finally, solar panel owners can also save money through the energy savings they make by generating their own electricity. By using solar panels to generate electricity, homeowners can reduce their reliance on grid electricity, which is subject to price rises and fluctuations. This can lead to significant long-term savings on energy bills.
The amount of money that can be saved through energy savings will depend on a number of factors, such as the size of the solar panel installation and the energy usage of the household. However, on average, solar panel owners can expect to save around £200-£300 per year on their energy bills.
Conclusion
Solar panels are a great investment for homeowners looking to reduce their reliance on grid electricity and save money on their energy bills. In the United Kingdom, solar panel owners can earn money from their installations through the Feed-in Tariff, Export Tariff, self-consumption, and energy savings. While the Feed-in Tariff is no longer available to new applicants, there are still plenty of ways in which solar panel owners can earn and save money from their installations.
Leave a Reply