How much will my electricity bill be with solar panels? That is a question a lot of people ask when deciding whether to make the switch to renewable energy. The answer is a little complicated because it depends on a few factors, such as the size of your solar panel system and the amount of electricity you use. However, with solar panels installed, you could reduce your energy bills by as much as £440 per year.
In this article, we will give you a breakdown of how solar panels can reduce your energy bills, as well as the other costs associated with installing them and how to apply for government incentives.
Energy Bills in the UK
In 2004, the average annual electricity bill was £284. In 2017, it had increased to £599. This means that the average annual electricity bill had more than doubled over 13 years. In 2022, energy bills have increased enormously with the average household electricity energy bills now around £987, and energy bills overall approaching upwards of £2,000.
However, with solar panels, you could potentially reduce your electricity bill by as much as £440 depending on your current bills and how much energy your household produces and consumes.
The amount you save on your electricity bill depends on how big your solar panel system is and how much electricity you use. The average UK home uses around 3,000 kWh of electricity a year, so a 3,000 kWh solar panel system would be the perfect size for most homes.
In general, if you have a solar panel system that is around the same size as your home’s electricity usage, you can expect to save around 50% on your energy bills. This is because you will be using renewable energy from the sun, which is free, instead of electricity from the grid, which costs money. You can even make money from your solar panels by selling excess energy back to the grid. This is done through the Smart Export Guarantee which replaced the Feed-in Tariff in 2019.
Other Costs Associated with Solar Panels
While these savings are obviously good news, they need to be weighed up against the other costs associated with solar panels. These include:
The Solar Panels Themselves
The initial purchase cost of solar panels in the UK has decreased significantly in recent years. In 2002, the average cost of a solar panel was £14,000 but in 2022, a 4,000kWh system costs around £4,800. This is a decrease of almost 65% which shows just how affordable solar panels are bow becoming. Furthermore, the cost of solar panels is expected to continue to decrease in the future as technology improves and there are more qualified installers available. Speaking of which…
The upfront cost of having a solar panel system installed ranges from £500 to £3000, with the average installation costing around £1,400. In the UK, installers must be MCS (Microgeneration Certification Scheme) certified so it is important to make sure that the installer you choose is certified. They will be able to provide you with a certificate of installation that is valid for 20 years (as well as the manufacturer’s warranty on the panels and system itself).
Once your solar panel system is installed, there is very little maintenance required. You will need to check the inverter and cables every two years and clean the panels every few months, but that’s it! This means that you can enjoy the long-term savings of solar panels without any additional costs.
If you want to store solar energy so that you can use it at night or during a power cut, you will need to buy batteries. These can also be very expensive ranging in price from £500 to £6000. However, batteries can be an excellent way to maximise the savings you make from your solar panel system because they allow you to use more of the energy your panels produce.
UK Government Solar Panel Schemes
In addition to the savings you can make on your energy bills, the UK government offers a number of grants and incentives for people who install solar panels. These include:
Smart Export Guarantee
As noted above, the Smart Export Guarantee replaced the Feed-in Tariff in 2019. It is a scheme that pays people to export any excess energy they produce back to the grid so that it can be used by others. The rate you are paid for your energy depends on the size of your solar panel system and how much electricity you export.
In order to be eligible for the Smart Export Guarantee, solar panels must meet a set of criteria. These include that they must be installed by a certified installer, have a minimum efficiency of 12%, and be certified under the Microgeneration Certification Scheme.
The ECO4 scheme (recently replaced the ECO3 scheme) is a government grant that incentivises people to install energy-saving measures in their homes. It is available to all households, regardless of income, and can be used to fund the installation of solar panels. You can receive a grant of up to £5,000 depending on a range of different factors such as the size of your system, the amount of energy it produces, your household income and more. You can apply for the scheme directly through your solar panel installer.
To find out more about who is eligible for the ECO4 scheme, click here.
The Renewable Heat Incentive
The RHI was set up to incentivise the use of renewable heat technologies such as solar thermal panels, biomass boilers and air-source heat pumps. It worked by paying people a tariff for every kWh of heat they generated from a renewable source. The amount you received depended on the type of technology used, the size of the system and how long you had been generating heat. Although the RHI was recently closed to new applicants, you can still receive payments for the heat you generate if you were already signed up before the scheme ended.
So are Solar Panels Worth It?
As you can see, to work out whether solar panels are financially worth it, you will need to consider:
- The cost of the solar panels and installation
- The amount of energy they produce
- The amount you will save on your energy bills
- Any government grants or incentives available to you
Taking all of this into account, solar panels can be a great investment for homeowners in the UK. Not only will they help you save money on your energy bills, but they can also increase the value of your home. And with the government schemes available to help you pay for them, it’s easier than ever to go solar!
As well as the potential savings, there are also various non-financial befits of having solar panels. These include:
Less Reliance on Fossil Fuels
Solar panels help reduce the number of fossil fuels needed to meet our energy needs. This is important because it helps reduce greenhouse gas emissions and helps slow climate change. With the UK government committed to phasing out coal-fired power stations in the coming years, solar panels are an important part of the country’s energy mix.
Less Air Pollution
Solar panels also help reduce air pollution, which is a major problem in the UK. In fact, according to the World Health Organisation, air pollution is now the biggest environmental health risk in the world.
A Reduced Carbon Footprint
Installing solar panels also helps reduce your carbon footprint, which is important given the UK’s commitment to reducing greenhouse gas emissions. Scientists say we must reach net zero emissions by 2050 if we are to avoid the worst effects of climate change so by installing solar panels on your home, you will be doing your bit to save the planet.
Having solar panels can help you become more self-reliant and less reliant on the grid. If there is a power cut, you will still have access to energy from your solar panels. They can also be a great long-term investment, as the price of solar panels is predicted to continue to drop in the coming years.
Better Energy Security
With the uncertainty of Brexit and the current geopolitical situation, it’s more important than ever to ensure that your home has its own source of energy. Solar panels can help provide you with a secure and reliable source of energy, even in times of crisis.
Little Maintenance Required
Once your solar panels are installed, there is very little maintenance required. As noted above, you will only need to check them every few months and clean them a couple of times a year. This is in stark contrast to other forms of renewable energy such as wind turbines, which require regular maintenance and repairs.
Increased Property Value
Finally, one of the best reasons to install solar panels is that they can increase the value of your home by as much as 10%.
Of course, solar panels do not come without their drawbacks which you will need to factor into your decision. These include:
The Initial Cost of the Solar Panels and Installation
As noted above, solar panels can be expensive to purchase and install. However, as can be seen in this article, the government does offer grants to help you pay for solar panel technology and the potential savings on your energy bills can make them a wise investment in the long run.
As solar panels rely on the Sun to generate electricity, their performance can be affected by the weather. This means that you may not always get the full benefit of having them installed on your home if it’s often cloudy or rainy in your area.
Their Unsuitability for Some Homes
Not everyone can install solar panels on their home. If you have a south-facing roof and your property is not shaded by trees or other buildings, then you are likely to be a good candidate for solar panels. However, if your roof is not suitable or you live in a rented property, then solar panels may not be the best option for you.
The Amount of Energy they Produce
Solar panels do not generate energy at night so you will need to consider whether you also need to pay for batteries to store the energy you produce during the day.
The Environmental Impact of Solar Panel Production
While solar panel operation has many environmental benefits, the manufacture of the solar panels themselves can have a negative impact on the environment. However, this manufacturing process is becoming more environmentally friendly all the time so the damage is far less with newer systems.
As you can see, the question “How much will my electricity bill be with solar panels?” is just one thing you need to consider when making the switch to renewable energy. You also need to weigh up the initial purchase and installation costs, the help available from the government, the non-financial benefits of solar panels and the potential downsides.
However, for the vast majority of households in the UK, solar panels are a wise investment that can save you money in the long run. They will enable you to reduce your reliance on fossil fuels, slow the progress of climate change and have a positive impact on the environment.