I'm thinking of jumping on the solar band wagon but not sure if we should.
We live in a single storey house in Melbourne.
No air conditioner, only 1 small TV, all LED lights hence below average electricity use. Our electricity bills are around $70/month.
Gas cooktop, gas hot water heater. Gas heater but hasn't been used for a few years. Gas bill around $70/month.
Is there any point getting solar panels given our low energy usage?
@Repposh: oh yes definitely and the hot water part of my bill is nearly the same cost as my actual electricity use so i think the hot water part we need to cut down on
unless you are buying with one of the interest free loans the payoff is even longer as you need to account for opportunity cost. e.g. if you put that 3690 in account getting 3% you would make over $1200 in that 10 year period. far better payoff for you than the panels.
Sounds like a nice house. How do you stay cool in summer and warm in winter?
Curtains, fans, electric blanket
Google up solar ‘break even calculators’ and stick in your best estimates. My electric bill is pretty close to yours (a bit under) and I don’t break even on solar for 10-12 years depending on the size of the system I instal.
Like doncat says above, you might only make $500 pa on FIT. Even if you saved half your electricity costs, that’s only $420 pa and maybe a few $hundred FIT so you save $600 pa in total. If you get a $5k system (rough cost of a 6.6kW) then it’s an 8 year payback. And that’s a best case scenario
Anyway, run your situation through a few calculators
Thanks for the tip. According to the calculator we're looking at a 13 year payback period
Is there any point getting solar panels given our low energy usage
With such low power usage it's unlikely to be large financial benefit, with a much longer break even payback period. Especially as you've mentioned a 5-10 year expectancy of living there.
Though if you considered things like migrating your hot water and cooking to electric, as perhaps those appliances may be worth upgrading at some point in the future, then the maths would look much more favourable.
We had new gas cooktop and hot water system installed only 4 years ago. Ironically the hot water system before that was electric and it used a LOT of electricity
For your current usage I will say no probably not. Solar requires a high expense upfront depending on many factors from size of the array, the inverter etc. And with such low electricity usage won't make much financial sense. The big electricity drainers are electric hot water systems, induction cook tops, pool pumps, Heating and cooling AC, charging an EV. If you don't plan on any of these then a solar array probably doesn't make much financial sense for your current usage and situation.
We'd probably also need to upgrade our switchboard as well since it's over 20 years old.
I would love to make the switch from an environmental standpoint but financially it doesn't really make sense.
A friend of my colleagues also started having a leaky roof since installing solar on tiles. I realize it depends on the installer but you'd hate to get the one dodgy operator
No point with panels.
That is without feed in return which isn't much
Now for me, who has had a $350 per month bill before solar, costing $4,200 a year. Now with Solar, my bill is under $200, so I am saving $150 a month minimum. That means my ROI on my $3,500 system (cost 2 years ago) is 2 years. I have already had the return on my system in 2 years. That isn't considering I get about $15 a month feed in return so bills are about $180 now, down from $350. So it's probably quicker than that.
TLDR version? You won't get the return on the system and it is pointless in your case. That is my 2 cents.
TLDR version? You won't get the return on the system and it is pointless in your case. That is my 2 cents.
Just double checked latest electricity bill. Around 2/3 of the cost was supply charge and 1/3 usage.
So the most we'd save (assuming 100% self consumption which isn't possible) is $280/year. More likely scenario would be self consumption of 20% given I'm not home during the day. So saving is $56/year. If solar generates 8000 kWh and self consumption is 300 kWh then feed into grid is 7700 @ 4.8c = $370
So ROI is $56+370 = $426/year.
$5000/$426 = 11.74 years.
Bankwest savings rate = 4% so on $5000 that's $200
I guess solar could be considered a marginally better ROI than a savings account.
On second thoughts, if we convert our hot water and cooktop to electricity then that would increase self consumption and mean we could disconnect from gas so more potential savings.
Have you considered getting solar + battery system? Then overnight you are running on the battery? That would be a great saving.
More likely scenario would be self consumption of 20% given I'm not home during the day. So saving is $56/year.
See I guess that is the difference, I WFH full time and have a spa, so it all runs off the solar all throughout the day.
So ROI is $56+370 = $426/year.
$5000/$426 = 11.74 years.
11 years is still a long time to get the full return. And that is on the basis the feed-in doesn't go down, which mine has in two years from 7 cents to 5 cents per kWh.
On second thoughts, if we convert our hot water and cooktop to electricity then that would increase self consumption and mean we could disconnect from gas so more potential savings.
Yes, definitely. Something that we have considered and will eventually do is move our hot water from Gas to Electric. But going to do that most likely when the gas system fails.
Yes, but battery is very expensive. In my case increases payback period by around 5 years according to https://solarcalculator.com.au/
@geekcohen: Same here. It’ll probably be another few years before they make financial sense. In the mean time they make great sense if you want to stick it to the elec co and not pay connection fees etc.
Same here - battery just doesn't make financial sense (yet). EV batteries are much larger and I don't know why they can't just make V2H/V2L technology more accessible to consumers in Australia
Yes yes, keek the solar panel industry propaganda going, so the rich people can buy their carbon offset credits and blame you, make you feel guilty, for buying the disposable crap they make.
If you honestly want to make a positive change to the envrionment stop buying crap (which is 90% of stuff) and vote for non-hypocritical politicians who WILL throw evil (polluting) rich people in jail.
Yes yes, keek the solar panel industry propaganda going, so the rich people can buy their carbon offset credits and blame you, make you feel guilty, for buying the disposable crap they make.
Hmmm. Why wouldn’t you get solar if you have the opportunity. Once you’ve got it, you make your own power and stick it to the - insert target for emotion here -
If you honestly want to make a positive change to the envrionment stop buying crap (which is 90% of stuff) and vote for non-hypocritical politicians who WILL throw evil (polluting) rich people in jail.
This is however, a good point. The less crap we buy and the more polluting corporations that get shafted the better.
With the rebates being fixed dollar amounts instead of a percentage putting in a cheap system costs pretty much peanuts - there's a recent deal that's about $3,600 (of which $1,400 is a loan you'll pay off at $30 a month to the govt). - https://www.ozbargain.com.au/node/757760. If you hunt around a few solar installers I imagine you could get it lower, basically try get as near zero cost for you as possible.
There are also rebates now and coming to switch from gas to electric, if you take advantage of them you can make more use of your solar to replace your gas usage. Getting rid of gas entirely can save a fair wad of cash because of the gas connection fees themselves rather than usage.
One thing to check with your electricity bill though is how much of that $70 is usage vs connection fees. You won't save $70 a month going solar if $40 is just being connected to the grid.
Our bills are around $45 supply, $25 usage
Seems quite a bit for supply, remember to take advantage of the $250 the vic govt will give you to do a rate comparison. Some are closer to a dollar a day, you'll pay more per kw/h but it sounds worth it.
But yeah, might be hard to really save much with solar at the moment as you'll still need the grid.
+1 on switching away from gas.
Don't forget you can also claim rebate for switching to heat pump hot water system.
When I looked into the hot water system rebate it wasn't available if you had gas hot water.
I'm in VIC and just had this upgraded in October from a tank gas hot water system.
No air conditioner, only 1 small TV, all LED lights hence below average electricity use.
LED lights are probably at night time? TV possibly too (not necessarily). If you're not using power from solar during the day, you're still paying the same amount.
They're not paying the same amount. Fridges and freezers, washing machines, dryers, fans, etc.
You could wait for perovskites to hit the market
To us (a owner occupied house in Melbourne suburb with 2-3 residents), it does not make much sense financially.
But we find having solar panel installed greatly prompts us using more appliances for our convenience/pleasure, such as air conditioning and dryer, dishwashers.
So, for us, it definitely worths it.
Get a Powerpal installed, it's free provided the vic state gov scheme has not ended. This provides a fairly accurate usage down to hourly intervals. After some time you can understand the size of system you should purchase, and the possible savings, thus estimated roi based on close to actaul figures. The powerpal app also includes a solar calc if you cant be bothered working it out yourself. The calc has a slider to adjuat the kw unit you will install, and the savings, based on the usage it has measured.
Solar panels also acts as a shade for your roof so your house will be cooler. Requires less energy to cool if you use Aircon. It you don't care about ROI or financially able I suggest you get them. Nothing beats using your homemade non certified organic energy.
If the inverter break down, they don't screw with your electrical system. Plus you can always disconnect the circuit if solar energy is not up to your taste. So it's really good to have.
I would imagine the cooling benefit from having solar panels covering your roof would be marginal at best - you'd get much better financial returns from changing the colour of your roof or installing proper roof insulation, if that's your goal
At that ultra low electricity usage rate, solar panels would not be even close to worth it. For our household like us, it was definitely worth it and will break even in 18-24 months (not to mention the environmental benefits). We have no gas connection, work from home, and a high electricity-consuming inducted A/C and hot water system. You really need to understand how your house consumes energy to get the max benefits. Solar cut our daily grid energy use by about two-thirds.
I'm not a big user myself, live in Tasmania, and i got solar 2-3 years ago and changed gas hot water to electric and disconnected gas. Have not paid a bill since. For me it saves me about $2000pa. I'm getting about 10c feedin tariff from 1st energy and got the 6kw system from Captain Green. I did get a fancy reverse cycle hot water system which was expensive, but all up probably spend $8k on the conversion 2-3 years ago. I'm a pensioner and get some discounts and allowances on utilities, have 3 people in the home, a reverse cycle heater/AC and never hesitate to use it. I'm totally sold. Especially not having a gas bill!!!
fancy reverse cycle hot water system
Do you mean heat pump?
(As reverse cycle means it both heats and cools)
Yes sorry, heat pump…. in tassie we have many long sunny summer days which builds up my credit, and in winter i use that to pay the winter bills. Each year so far I've ended up with a little more credit in the account. In summer i use about 20kwhrs and in winter maybe 50 per day. In summer i get like 20+kwhrs extra each day…. roughly…. i have a spreadsheet for it to record each month :)
Wow, sounds like you have had a great experience. Are you not paying bills because the amount exported into the grid @ 10c/kWh exceeds both the supply charge and your own usage?
Do you know how much electricity electric hot water and induction cooktop use? Would 3 kWh per day for hot water and 3 kWh per day for cooktop be a reasonable amount? Trying to run the figures with gas conversion as well.
Our large hot water system serving two people, each shower once per day uses 7kWh per day.
Its pretty big and capable of servicing about 5 people, so not really efficient as its storing alot.
Ours is connected to controlled load 1 - so its the direct reading averaged over the 90 day bill period.
Induction cooktop pulls about 1.6kW per induction hob. So it will pull 1.6kW until it gets to temperature and then significantly back off and pulse to keep it there. i'd say cooking bacon and eggs in the morning takes about 0.13kWh
The oven is by far the worst, something like 2.2kW almost constant draw - buy an air fryer.
Wow, 7kWh seems really high. Is that a 250L tank?
That would definitely increase self consumption with solar panels.
Cooktop use sounds reasonable though.
@Repposh: A useful measure is how a calorie is how much it takes to heat 1mL of water by 1 degree. A Wh is 860 calories. Likewise a kWh is 860 kcalories
So to heat 250L of water by 40 degrees is 10,000 kcalories or about 11kWh. 2 people having showers and some additional usage is probably around 100 to 150L a day used, so it roughly adds up.
It’s why heat pumps are great, it takes less energy to compress and expand liquid than it does to straight heat it, thus why they claim over 100% efficiency. However it also chills the air outside the heat pump thus why no laws of thermodynamics are broken
How do you not get a bill in winter especially in Tassie? Never understood this when people mention it, unless you have a battery or don’t use appliances at night. Overcast winter days will generate bugger all solar energy. I got solar installed in September and just got a bill the other day (first bill for all solar period) which was $36 credit (previous bill covered non solar and solar period) but that’s during summertime even then some days when we had bad weather in Sydney there wasn’t much solar energy generated.
To get the most benefit from solar you would need to disconnect from gas and go fully electric. You would save money on the daily gas supply charge. Also you can use your air conditioner for heating which is supposed to be cheaper to run than gas heaters. Induction stoves are also more efficient than gas.
I'm leaning towards this too
No gas fumes either.
I have solar
6.6kw system was $2250 last year and its going great
Even then though in wa itll take around 5 years to pay off
That's a good price for 6.6kW. I think prices are between $3600-$6000 these days (excluding switchboard upgrade)
No
I just wish the price of the battery's would come down in price
It's just not worth it at the moment
I agree. It's such a waste sending excess energy into the grid when it's not needed
This. Waiting for battery prices to drop also as well as better battery technology. Currently a decent battery will take about 10 years ROI which is also the battery life. Apart from being sustainable, it’s a big outlay especially after getting solar and replacing gas hot water with a heat pump HWS (which is great). Need to replace the gas cooktop with an induction cooktop next. LPG is getting very expensive.
No.
Go here: https://app.getpylon.com/app
Design a system.
On the System Production page, assume $1,300 per kw for the cost to install.
Assume System Efficiency of something like 40-50% unless you absolutely optimal layout with zero shade (almost certain to be false in the city). This is down the bottom of the page.
Go to CitiPower and download your demand history: https://myenergy.powercor.com.au/s/login/?ec=302&startURL=%2…
Upload your demand history to Pylon's demand simulator. Or use a self-use factor of something like 40% (mine is 41% based on the CitiPower data). Installers will often claim you will get 80% but that is nonsense.
Go to the 'Financial Outcomes' box and set the feed-in tarrif to something like 5c, maybe 4c to be a little conservative (FIT drops seem to have settled).
Set the power price to something sensible. Maybe 22c or something. Maybe a bit more to account for rises likely in the next two years.
Go to the Settings option:
Ignore inflation rate and nominal interest rate as they are (we aren't going to use them).
Set the electricity price increases to something fairly high. Certainly higher than the 2% they have it at.
Set the Term to 10 years - assume when you sell your house nobody is going to pay extra for a dated installation, so residual value at 10 years is 0. If you're staying longer you need to account for repairs/replacements. This has a massive impact on returns and is how installers fool people to think they are getting a great deal.
Save and calculate - you should get a (nominal) IRR, which is your return. As a minimum you would want this to be more than your average expected mortgage rate for the next 10 years.
Ignore the NPV value as the interest rate and inflation numbers used are completely wrong.
It is very likely the return will be less than just repaying your mortgage.
Good luck.
In 3 years, we have paid $300 in power bill in total, $1000 in credit and gotten about 10k KM (avg about 30km a day over last 15months) using my Outlander PHEV (which itself cost 33k)
https://www.ozbargain.com.au/node/488461
Wow, that's a great price for 6.6kW solar system plus 2x6.5kWh batteries!
$5k just for the batteries would be a great price.
Jesus what a deal.
Insane deal.
If you aren’t home during the day to use it then no, don’t get it. The feed in now is a joke.
Sad but true
I just got a 6.6kw system installed at my townhouse. I work from home and have an EV which helped to justify the install. Electricity was $160ish/month.
I’ve got a pretty sad feed in tariff due to the embedded network in the complex, but it should still pay itself off in 5-6 years I think. I’ve definitely gotten more relaxed with the AC now so maybe slightly longer. But if electricity keeps going up, maybe it will take less.
5-10 years… Maybe it’s not worth it for you to be honest. Your bill isn’t all that much!
Hoping to buy an EV in the next 5 years. Prices are just insane at the moment due to demand
Electricity will keep going up every year so the ROI period will decrease.
I'm not sure if electricity prices will keep going up. According to AEMO spot prices have dropped back to 2019 levels (page 12 in link below). The increase in green energy- particulary distributed PV cells - should offset the decrease in coal/gas powered energy generation.
https://aemo.com.au/-/media/files/major-publications/qed/202…
Is that wholesale price? Because I can definitely tell you I’m paying more than I did in 2019, especially the supply charge.
@Jono05: Yes, those are spot/wholesale prices. Retail prices have definitely increased since 2019, but what I'm thinking is that they shouldn't increase much more based on spot prices decreasing, and projected to decrease further due to increasing PV/solar/wind energy.
@Repposh: Shouldn’t go up but will because electricity companies are leaches plus they’re losing money when solar systems are giving credit electricity bills.
If the government is serious about 'saving the planet', they should construct solar panels on the roof of every building for free, rather than clear felling land in the middle of nowhere and filling it with solar panels.
Not sure about “clear felling”, all the solars farms I’ve seen in the central west are on farm land not in the bush
Every single one is already on farmland.
Before considering solar I'd look at disconnecting your gas. Replace with an electric cooktop and remove the heater (either install a split system or just buy a decent plug in electric heater if you need it). Going to save you a lot of money in gas, especially since your usage is low and it's mostly just supply charges.
Would be good to know how much electric cooktops and electric hot water systems use. According to the internet a 2000W cooktop would use 2kW per hour. And a 150L electric heater uses around 3kWh per day. Do these figures seem fair?
2kW cooktop will use 2kWh per hour, right. Heater depends a lot on the size and type, reverse cycle being by far the most efficient.
My understanding was that gas tends to be a little less expensive to run, but the removal of the second supply charge more than makes up for it. That said, I didn't know you had hot water too, you'd have to do the maths on the savings. Gas hot water on demand is pretty efficient.
Yes, I'm thinking the switch is only worth it if induction cooktop and electric hot water service use less than 6kWh per day. Or unless I get solar panels.
Exactly, daily supply charge for gas is probably the biggest portion that you can’t lower. You already pay supply charge for electricity.
I would install solar first then change gas hot water to electric, install air con and change cooktop last. Hot water uses more gas than cooktop, well it did in my house anyway.
It's mostly the supply charge. Ends up being a lot over ten years. But doing solar first might be worthwhile if you have the money.
Yeah, cooktop's not going to change your solar payoff much since most of the time you'll be cooking when the solar isn't producing much (and likely during peak electricity prices if on TOU). But it will allow you to get off gas and not pay the supply charge if the rest of the house is off gas.
Not worth it, used to live in Mel, had a 3.5kw system.
Did the 3.5kw system not produce enough energy?
3.5kw is a joke, so I wrote down the numbers after 1 year of usage, it pays itself in 20+ years, assuming the system doesn’t die. Obviously depends on your usage but if I could go back in time, I wouldn’t buy it.
With the current FIT you will not see the $$$ benifit for more than 10 yrs. How ever this could change when cost of electricity increases! Also not just electric cars, electric bikes / scooters could also become popular.
Funny you should mention that. I have an electric bike which has been brilliant. Costs less than a dollar to charge with a range of 40-50km.
Do you ride to work?
Sure do! Just over 10km each way so not too far. On super rainy days I catch the train though.
$1 a day would be about $200 a year and $2000 in 10 yrs.
That would be about 20-30% of the cost of your solar system.
Although, not sure if you will be able to charge your bike during daylight if you are using it to commute to work.
Your electricity bill is so low because your gas bill is so high. Dont worry about solar unless you want to start switching more to electricity (which gas prices will probably naturally push people towards anyway).
True, our gas bill is way too high. According to Canstar the average for Victoria is $186 per quarter or $62/month. Would love to get rid of this but the appliances are only 4 years old so I can't justify switching at this time.
I have a 3.5Kw system, here is my average TAS summer day electricity usage with feed-in $0.40 cents a day
I have a peak and off peak tariff.
Hot cylinder is on a timer so only comes on at off peak times.
Dishwasher, washing machine, dryer all have timers for easy off peak usage.
Thanks for sharing. You've done well. There's hardly any use during the peak periods. Can I ask, why is the baseline consumption so much higher in winter (0.2 vs 0.02)? Is that the heater running all day?
Yes 8kw 'Heat Pump' we call them here, 21 during the day, 18 over night. Don't want to be that guy but global warming will help me energy usage…
In Tassie most electricity is green… Hydro and now solar as well
personally, I don't think it is worth to have solar system installed, especially if you don't get a good FIT and requires a battery or two.
with the current cost of installation, unless you don't have other mean of getting a better ROI for the amount of money you are going to pay for a whole solar system, I wouldn't recommend to buy into it.
I got a mixed feedback from solar system owners, some requires little to no maintenance while some fork out an arm and a leg, taking this into account makes installing a solar system even a worse choice.
your cash is liquid, in some sense, even a solar system gives you a little better ROI, once you install it, your money is gone forever. unlike other investments, you can liquid your assets as you need whether they are liquid or non-liquid.
I know the cost of electricity is getting higher but I would choose an option which give me the best possible return. I'm not against installing a solar system and I love to have it one but not at the current cost.
so after all it is your decision but you should take everything into account for the best use of your money, especially the cost of opportunity.
some requires little to no maintenance while some fork out an arm and a leg
I'd say the vast majority are in the former. In which case it makes sense. Still a 5 year payoff and after that you're in the green is a fair gamble.
Solar systems are not about the FIT. They are about cutting your own consumption from the grid. If you can use most of what you generate it’s worth around 50c/kWh. Selling it to the grid is virtually a waste.
@Repposh: I'm a bit curious about your figures, they look a bit off but I'm interested to hear how you come to those.
Lets just go worst case at $4700 install price.
Lets again just go off the absolute base of zero self consumption
All your investment savings are coming via FIT.
6c kWh x 7640kWh pa= $458
4700/458= 10.2 years payback
At 10c FIT
10c kWh x 7640 =$764
4700/764=6 year pay back
Now I would admit off the bat that the 10c FIT plan will not be the cheapest daily surcharge and usage rates you could get, the plans that have that would be the bare minimum FIT, however as you are low consumption high FIT is the go.
Anyway interested in your thoughts on these figures and why yours are so different