Solar PV Prices and Savings
By Beth Askham
Article 3 of 12
Solar PV Prices and Savings
Find out how much solar PV panels cost, whether solar panel prices are coming down, what financial help is available to buy them, and the pros and cons of domestic solar power.
Wondering whether solar panels will pay for themselves? We've crunched the numbers for you.
Solar panels aren't cheap. But if they can help you cut your energy bills, plus earn you money by generating electricity that you can sell back to your energy company, does this mean you'll end up quids in?
Keep reading to learn more about solar panel costs versus how much money they can earn and save you.
Solar panel prices
Prices for solar PV systems vary depending on the size and type of the system, as well as the structure of the building on which the panels will be installed.
An average PV system of 4kWp (kilowatt peak) costs around £5,000 to £8,000, with solar tiles working out as more expensive than conventional solar panels.
The more electricity the system can generate, the higher the savings on your energy bill will be – but the bigger the initial cost is.
In addition to the savings on your bill, you'll get paid under the Feed-in Tariff (FIT) scheme for generating your own electricity.
Cost of solar PV is coming down
The idea behind FIT is that, as solar PV takes off, the cost will drop. And this is why the rate of the FIT is decreasing over time, to compensate for the falling cost of solar systems.
The former Department of Energy & Climate Change (DECC) said that there has been a rapid fall in the global module costs of solar PV since the introduction of the FIT scheme in April 2010. The former minister of state at the DECC, Greg Barker, also said: 'As solar PV technology has developed, its costs have reduced and [they] are now believed to be around 30% lower than originally projected.'
When we surveyed 1,530 Which? members who have solar panels, we found that, on average, they paid the following for an installed 3.6-4kWp solar PV system:
As you can see, prices of solar panels have been coming down, especially in the past three years.
Solar panel grants
Solar electricity has attracted much interest since the government introduced the FIT scheme in April 2010. The scheme pays you for every unit of electricity your solar system generates.
To qualify for the FIT, you have to use products and installers certified under the Microgeneration Certification Scheme (MCS).
However, the government cut the FIT for small domestic solar PV installations by 65% as of 1 January 2016. That means you now only get 4.39p for electricity generated, instead of 12.92p.
To learn about the FIT, including how much money you could make, read our guide to the Feed-in Tariff.
Pros and cons of solar PV
Pros of solar PV:
- only daylight is needed to create energy – not sunshine
- can be connected to the national grid and any excess electricity sold back to an electricity company
- can cut an average household electricity bill by about 40%
- provides additional income, as the Feed-in Tariff provides cash payments to households that produce their own electricity using a renewable technology.
Cons of solar PV
- more expensive to buy and install than solar water systems
- high initial outlay: typically £5,000 to £8,000 for a 4kWp system
- efficiency depends on the number of solar light hours and climate
- initial costs are higher than for conventional electric and gas-heater systems
- unshaded, south-facing location is needed for installation
- solar panels can be heavy, so your roof must be strong enough to take their weight – particularly if the solar panel will be installed on top of existing tiles.
Want to know which manufacturers make the best quality solar panels? See our solar panel reviews.