A Guide to UK Solar Panel Grants

Image by Antranias CC0

Image by Antranias CC0

Guest post by Elena*

A quick glance around any neighbourhood in the UK will reveal many homes with solar panels in situ. They don’t work for every homeowner, but if your property has a south-facing roof, or even an east to west facing roof, you could save money on your energy bill and get paid for generating electricity. What’s not to like about that?

If the idea of installing solar panels appeals, here’s what you need to know about solar panel grants in the UK.

Solar Grants

Prior to 2010, the government handed out grants to householders who installed solar power systems. It was part of the low carbon buildings program, which proved very successful. However, these grants were replaced in April 2010 by a new system: a feed-in tariff.

Feed-In Tariffs

These days, the government no longer pays you to have solar panels, but the electricity companies do pay for you for the electricity you generate. Think of a feed-in tariff as an incentive scheme. Not only does the energy company pay you for any electricity you don’t use, but you are also paid for the electricity you do use. Even better, when you are using “free” electricity during the day, you are saving money on your energy bill. It’s a win-win situation.

en-form insights:

The downside is that government feed-in tariffs are no longer as generous as they once were. Solar panels are not as expensive to install, so feed-in tariffs were slashed by 64% in 2015. You can still save money by generating free electricity during the day, but you won’t be paid as much for your output. Homes with an EPC of E or less are not eligible for the full feed-in tariff payment.

Getting paid for the electricity you generate through solar panels used to be seen as a bit of a gold-mine by homeowners, which certainly isn’t the case any more. Nevertheless, so long as your solar panels generate a reasonable amount of electricity, you should enjoy a return on your investment.

Lock in a Good Price

It is worth noting that the feed-in tariff in place when you install your solar panels is locked in for the next 20 years. Right now, it is still cost effective for homeowners to install solar panels, but as time goes on, the government is likely to cut pay outs and, in time, eliminate them altogether.

There is a cap in place on annual feed-in tariff spending, so each quarter, the feed-in tariff is reduced. As time goes on, the potential for earning money from the feed-in tariffs will diminish, but the cost of installation will continue falling, too. Also, since any electricity you use during the day is free, you are always going to save money on your energy bills.

Solar Batteries

One method of making extra savings once the government abolishes a feed-in tariff for solar panels is to invest in a solar panel battery to store excess energy when your panels are not generating. Most homeowners don’t use all the electricity they generate, so it is sold back to the energy company. With a solar panel battery, you can use solar energy as your primary power source and save even more money.

en-form insights:

The installation of PV panels has dropped because of the FiT digression, and batteries are being viewed as they new money-maker. PV installers are asking several thousand pounds for a battery set, as such, it is unlikely to pay for itself for many years. The installers also get a kick back from the National Grid by aggregating all the batteries and controlling them at peak times saving the National Grid from having to pay for stand-by generation. Most householders are lucky if they get a share of this, we have heard that some may get about £60 a year from the battery installer who probably makes a lot more. Homeowners need to be wise when choosing how to invest in solar energy – there are good reasons for having batteries, particularly if there is a high frequency of black outs. When variable tariff electricity pricing comes in (when you pay more at peak times), that will be when batteries are really economically worthwhile.

It is worth doing the sums before you invest in solar panels, and it is probably worth seeking independent advice on such an investment. Homes need to be south-facing to generate sufficient energy and the further south you live, the more profitable solar panels become. Remember that a solar panel installation can also affect the value of your home, and not necessarily in a positive way. But, like all renewable energy, solar power is the future, and if you can’t afford to invest in solar, you could always opt for a free installation, which will still lower your energy bills.

*Please note that the views are that of the author, not necessarily that of en-form.

About the author:

Elena works for maltasothebysrealty.com and is used to advising customers on the benefits of solar panels. In a country where the sun is always shining, solar energy is a smart investment and an excellent way to save money on your energy bills.

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