Includes
Strategies for
Home & Commercia
l
Building
Installs
How To Make Money From
Solar Energy
STRATEGIES TO
MAXIMISE YOUR RETURN
FROM THE UK GOVERNMENT’S
FEED IN TARIFFS
By Amy Catlow, Dan Tobin and Titus Sharpe
Chapter One
Introduction: How You Can Make Money
From Solar Energy
Most people are aware that solar energy is better for the environment than
traditional fossil fuels. It produces no air or water pollution and neither
does it emit greenhouse gases. But how many realise that there is another
huge benefit to be gained from this unlimited resource that’s already being
called the ‘energy of the future’? That added advantage is found in its
money-making potential - not just for the companies that manufacture and
install the systems but for homeowners too.
Solar power is still a relatively young science and therefore quite
expensive. Like all new technology, cost is gradually falling but for many
homeowners the high price tag of installing a typical solar panel system
remains a major obstacle. The result is that a range of incentives has been
created by the government and other interested parties to help bring a
solar solution within easy reach of the average homeowner. Now the smart
ones are discovering that not only are there long term financial benefits
from installing solar panels but very good reasons to take action sooner
rather than later.
This book is focused on helping homeowners optimise their income
from the installation of solar panels. It does this by explaining, in simple
terms, how to take advantage of this technology and use the incentive
schemes available. If done properly, individuals will not only be able to
recoup the cost of the system and enjoy big savings on their utility bills,
but they will also earn an ongoing source of passive income from all the
electricity generated by their system and from the excess that can be
exported to the grid.
2
How To Make Money From Solar Energy
The terminology in this book is kept simple so that anyone - beginner
or expert - can make sense of it. However, solar technology uses terms
that are not common in everyday use and some that are quite unique to
solar technology. For example, solar panels are sometimes referred to as
PV modules. ‘PV’ is an abbreviation of the term ‘photovoltaic’ and simply
refers to the process by which sunlight is converted into electricity. You
will find these terms and their explanations in a glossary at the back of
this book.
A common misconception is that solar panels need direct sunlight
to operate. In fact, as long as they have sufficient exposure to daylight
they will continue to produce energy in cloudy, overcast and, to some
degree, shaded conditions. They take the energy generated from
daylight and convert it into a direct electrical current. In order for that
current to be suitable for use in the home, it has to be transformed
into an alternating current via something called an inverter, all of
which will be covered in the following chapters. The location,
positioning and the amount of shade experienced daily from nearby
trees and buildings all affect the efficiency of the panels and,
therefore, the income that can be expected so we will be dealing with
all of these issues in order to discover how to maximise output and
income.
There are several ways that money can be generated through the
installation of solar panels. The most obvious is from the savings on utility
bills. With electricity prices set to continuously rise, this alone is a big
incentive to go solar. Then there is the Feed In Tariff Scheme (FITs) that
allows the homeowner two methods of making money from their solar
system. The first is through ‘generation’ that gives an income for every
unit of electricity produced, whether used by the household or not. The
other is via ‘export’ providing ongoing income for any excess electricity
that can be diverted to the national grid.
Introduction: How You Can Make Money From Solar Energy
There are tools available on the Internet that will help you to find
out fairly quickly what your return on investing in solar panel technology
will be. To get the most accurate calculation for your individual situation,
you need to know the answers to a few questions relating to your location,
property and household requirements. You will find plenty of information
in this book that will not only enable you to answer those questions but
will allow you to calculate your return for yourself.
There are a few things to weigh up when deciding if being part of a
scheme like this is for you and lots more to think about once you’ve
decided to proceed. It’s not as difficult as it first seems but a lot depends
on personal circumstances. What was suitable for a friend or relative may
not work for your location and household requirements. This book will take
you through the thought and planning process, step-by-step. It will guide
you through the information available and help you identify the options
most suitable to your situation. You will be shown how the Feed In Tariff
works and how you can maximise its benefits. You will also be given help
to calculate your return on investment, revealing hidden factors that could
greatly impact the return you can expect.
There are many types of solar panels available and it’s a good idea to
know enough about their applications to enable you to choose wisely. This
book will take you through the components of a typical system and the
practical things you need to know about - like panel angles and
temperatures - to ensure optimum usage. You will also learn how to do a
general survey of your home in order to evaluate its suitability. Although
the installer you choose will do a survey for you, it’s good to know what
they’ll be looking for and the different factors to take into consideration.
Those with a flair for DIY may be toying with the possibility of doing
the installation themselves. Although this would save money in the short
term, it will eliminate them from making money from the Feed In Tariff
Scheme.
3
4
How To Make Money From Solar Energy
Similarly, there are many good companies selling a variety of solar
systems but if you don’t know what to look for you could find yourself
disqualified from taking advantage of FITs. You will find information here
on choosing products, finding installers and the questions you need to ask
them.
When it comes to choosing solar systems it’s not just about the brand and
installer, it’s also about the type of module - thin film; polycrystalline;
monocrystalline - to name but a few. Each will have a different efficiency rate and
price and you will soon discover that some are more effective in certain situations
than others. You will be given plenty of tips for choosing the best option for your
home and checklists have been provided to help you stay focused on the information
that’s relevant to you?
As you begin to investigate the possibilities of turning your property
into an energy efficient, income generator, you will come across many
offers of FREE solar panels. On the face of it they look like a good idea,
especially for those who feel they’ll never be able to afford solar panels
any other way. The ‘free’ route is fine for those looking to save some
money on their energy bills while playing their part to reduce their carbon
footprint, but not for those who want to maximise income from their
installation. We will go through the pros and cons of free solar panels so
you can judge for yourself.
Although, the initial investment seems high, there are ways of raising
the money to cover the cost. Traditional financial institutions like banks
or mortgage lenders are now providing finance specifically designed for
the purpose. Some solar panel installers offer deals where they finance
the installation themselves or via a third party in a similar way that you’d
expect from a car dealership. When choosing this option, the cost of
interest and term of repayment has to be set off against the predicted
income generated, so the homeowner can expect to get a lot less from the
deal at the outset but benefits should increase over time.
Introduction: How You Can Make Money From Solar Energy
Just as you would expect from purchasing any high value item, there
are hidden costs and different ways of dealing with them. Once the solar
system is installed you want to be confident that everything possible is in
place to keep expense to a minimum. By understanding what routine
maintenance is required and what to expect from your warranty, the panels
can be kept working at peak performance, providing you with an ongoing
source of energy for your home, plus income for your future.
Those With Solar Panels And Those Without
Although the Feed In Tariff is a government backed scheme, the payments
do not come directly from the government but from the energy companies
themselves. Given that those benefitting from the full FIT payments are
being paid above the market rate for the electricity their systems are
generating, the money has to come from somewhere.
The energy companies find the extra money by passing the cost onto
consumers. Those customers who are not taking part in the FIT scheme will
be charged higher energy prices. In essence, those who do not have solar
energy or qualify for the FIT scheme will be subsidising those who do.
Your Questions Answered
Throughout this book you will come across the most asked questions
relating to different topics, but the first question that needs to be
answered is:
Q: Is Solar energy for me?
A: There are three main areas you need to consider at the outset to
decide if solar electricity is for you and your household:
5
6
How To Make Money From Solar Energy
1. Positioning: The best position for solar panels is within 90 degrees
of south. It doesn’t matter which way your house is facing as they
can be attached front or back. However, east and west facing roofs
are still viable, so don’t rule anything out before checking what
options are available to you. You do need to check to what extent
the roof area will be overshadowed by neighbouring buildings and
trees. Having the panels in shade for part of the day will affect the
amount of energy that will be generated by your system.
2. Roof Size And Strength: Available roof space plays a major role
in determining whether solar energy is an economically viable
solution. Typically, an area of around 10m 2 or more is required.
The simpler the structure of the roof, the better the capacity to
fit more panels than those that have lots of small, angled areas.
However, there are systems to meet different challenges so
nothing should be discounted before checking with an accredited
installer. Solar panels are quite heavy. It’s not always easy to
judge for yourself if your roof is going to be sufficiently strong to
bear the weight of solar panels without causing problems but you
can always get the advice of an installer or builder, if in any
doubt.
3. Planning Permission: The vast majority of home solar electricity
systems in England, Wales, Scotland and Northern Ireland fall well
within the limitations of size stipulated by the UK government and
require no planning permission. However, it’s worth checking with
your local planning office first and definitely if it’s a listed
building or situated within a conservation area or world heritage
site.
Introduction: How You Can Make Money From Solar Energy
Q: I live in a flat. Does this mean that I can’t take advantage of
solar energy?
A: If you live in a flat where there is a shared tenancy, it’s worth
speaking to the other owners of the building to see how they feel
about investing jointly in solar. Initial costs can be shared among
the flat owners and the system will add value to the property and
provide a good selling point for the future.
Q: What other benefits are there in installing solar panels, other
than to make money from them?
A: If you live or are thinking of living in a remote area where there
might be no other source of electricity available, installing solar
panels could work out more cost effective than having electricity
installed in the traditional way. For the sake of self-sufficiency
and as part of a very cost-effective contingency plan, solar energy
offers a virtually free source of power that’s good for the
environment, too.
7
How To Make Money From
Solar Energy
The UK Government has introduced Feed In
Tariffs, giving British homeowners the ability
to generate an estimated £1,000 per annum
from solar electricity.
This book is an informative read, giving you
an introduction to all you need to know about
solar energy and photovoltaic systems.
Having read the book, you will be able to
answer the following questions:
n Are solar panels right for your house
or business?
n How do you accurately calculate the
expected return?
n How do you install panels to ensure
maximum return?
n Should you consider installing free solar
panels?
n What are the hidden costs of solar panels?
n How do solar panels affect the sale of
your house?
For more information on Solar Energy visit:
www.theecoexperts.co.uk