Solar panels are becoming increasingly popular in the United Kingdom, with more and more households looking to generate their own renewable energy and reduce their carbon footprint. But how much money can you actually save with solar panels in the UK? In this article, we’ll explore the factors that influence your savings and give you a rough idea of what you can expect.
The cost of solar panels
The first thing to consider is the cost of installing solar panels. The cost can vary depending on the size of the system and the quality of the panels themselves. A typical 4kW solar panel system in the UK could cost between £5,000 and £8,000, although prices can be higher or lower depending on the specifics of the installation.
The good news is that the cost of solar panels has been falling in recent years, making them more affordable for households across the UK. Additionally, there are government incentives such as the Feed-in Tariff (FIT) and the Smart Export Guarantee (SEG) which can help to reduce the upfront cost of installation and generate income from excess energy produced.
Generating your own energy
Once you have a solar panel system installed, you will start generating your own electricity. This can significantly reduce your reliance on the grid and save you money on your energy bills. The amount you can save will depend on a few factors, such as the size of your system, the amount of sunlight your panels receive, and your energy usage habits.
On average, a 4kW solar panel system can generate around 3,400 kilowatt-hours (kWh) of electricity per year in the UK. This is enough to power around 1,000 homes for a day. If you use all of the electricity generated by your solar panels, you can save around £200-£300 per year on your energy bills.
However, most households won’t use all of the electricity generated by their solar panels. Any excess energy can be exported back to the grid and sold to your energy provider. This is where the FIT and SEG come in.
Feed-in Tariff (FIT)
The Feed-in Tariff was a government scheme that paid households for every unit of electricity generated by their solar panels, even if they used it themselves. The scheme closed to new applicants in 2019, but if you installed solar panels before then, you may still be eligible for payments.
The FIT paid a fixed rate for every unit of electricity generated, as well as a separate rate for any excess energy exported back to the grid. The rates varied depending on the size of your system, but on average, a household could earn around £150-£200 per year in FIT payments.
Smart Export Guarantee (SEG)
The Smart Export Guarantee is a newer scheme that replaced the FIT. It requires energy providers to offer a minimum payment for any excess energy exported back to the grid. The rate is not fixed and can vary depending on the energy provider. Some providers offer a flat rate per unit of electricity, while others offer a variable rate that depends on the time of day and demand.
On average, households can expect to earn around 5-6p per kWh of excess energy exported through the SEG. This could add up to around £50-£100 per year in earnings.
Overall savings
Taking all of these factors into account, a typical household in the UK could save around £250-£400 per year on their energy bills with a 4kW solar panel system. This figure could be higher or lower depending on the specifics of the installation and the household’s energy usage habits.
It’s worth noting that solar panels require little maintenance and have a lifespan of around 25 years. This means that the savings can add up significantly over time, potentially saving households thousands of pounds over the system’s lifetime.
Conclusion
Solar panels can be a great investment for households in the UK, generating renewable energy and reducing reliance on the grid. While the upfront cost of installation can be significant, there are government incentives available to help reduce the cost and generate income from excess energy. On average, households can expect to save around £250-£400 per year on their energy bills with a 4kW solar panel system, but this figure can vary depending on the specifics of the installation and energy usage habits. With little maintenance required and a lifespan of around 25 years, solar panels can be a smart investment for households looking to reduce their carbon footprint and save money in the long run.
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