How Much Do Solar Panels Save On Electricity Bills: UK calculation

The transition to renewable energy has become a trend in recent years. This trend is set to continue in 2024. More and more households in the UK will choose solar panels to meet their home energy needs. However, it is important to do the maths and understand how much you can save on your electricity bills before you install them.

How Much Can Solar Panel System Save You?

Installing a solar pv system can yield substantial savings on your electricity bills over the system’s lifetime. The amount you can save depends on various factors, including the size and efficiency of your solar panels, your electricity consumption, local electricity rates, available incentives, and the amount of sunlight your location receives.

Calculating Potential Savings

System Size and Efficiency. The size and efficiency of your solar panel system determine how much electricity it can generate. Larger systems with higher efficiency panels can produce more electricity, leading to greater potential savings.
Electricity Consumption. Your current electricity consumption plays a significant role in determining your potential savings. A higher electricity usage means more energy generated by your solar panels, resulting in greater savings on your electricity bills.
Local Electricity Rates. The cost of electricity in your area directly impacts your potential savings. Higher electricity rates mean greater savings from generating your electricity through solar panels.
Solar Panel Performance. Solar panels perform best under optimal conditions, such as clear sunny days with minimal shading. The performance of your solar panel system can affect the amount of electricity generated and, consequently, your potential savings.
Incentives and Rebates. Government incentives, such as tax credits, rebates, and feed-in tariffs, can further reduce the cost of your solar panel system and increase your overall savings.

Example Calculation

Let’s consider an example to illustrate potential savings:

System Size. A 4kW solar panel system, which is typical for an average-sized UK home.
Electricity Consumption. Assuming an average household electricity consumption of 3,600 kWh per year.
Local Electricity Rates. Average electricity rates of £0.14 per kWh.
Solar Panel Performance. Assuming the solar panel system generates 4,000 kWh of electricity per year, accounting for factors such as shading and system efficiency.

Step 1: Calculate the annual electricity savings from solar panels:

Annual electricity generation = 4,000 kWh Annual electricity cost without solar panels = 3,600 kWh/year × £0.14/kWh = £504/year
Annual electricity cost with solar panels = £0 (generation from solar panels) + 3,600 kWh/year × £0.14/kWh = £504/year

Step 2: Calculate the annual savings on energy bills from solar panels:

Annual savings = Annual electricity cost without solar panels – Annual electricity cost with solar panels = £504/year – £0/year = £504/year

Step 3: Calculate the payback period for the solar panel system:

Payback period = Total cost of solar panel system ÷ Annual savings
Assuming the total cost of the solar panel system is £6,000:
Payback period = £6,000 ÷ £504/year ≈ 11.9 years

How to Maximise the Savings From Solar Power?

To maximise the savings from installing solar panels, consider implementing the following strategies:

Invest in High-Efficiency Solar Panels. High-efficiency solar panels can generate more electricity in less space, maximizing the energy output of your system. While these panels may have a higher upfront cost, they can yield greater long-term savings by producing more electricity over their lifespan.
Optimize System Size. Determine the appropriate size for your solar system based on your electricity consumption, available roof space, and budget. A properly sized system can generate enough electricity to cover most, if not all, of your energy needs, resulting in maximum savings on your electricity bills.
Choose the Right Installation Location. Ensure your solar panels are installed in a location with maximum sun exposure throughout the day. Avoid shading from nearby trees, buildings, or obstructions that can reduce the efficiency of your solar panels and limit energy production.
Use Energy-Efficient Appliances: Pairing your solar panel system with energy-efficient appliances and lighting can further reduce your overall energy consumption. Energy-efficient appliances consume less electricity, allowing you to maximise the savings generated by your solar panels.
Implement Energy Storage Solutions. Consider installing battery storage systems to store excess energy generated by your solar panels during the day for use during peak demand periods or at night when sunlight is unavailable. Energy storage solutions can help you maximise self-consumption of solar energy and further reduce reliance on the grid, enhancing your overall savings.
Take Advantage of Incentives and Rebates. Research available government incentives, rebates, and tax credits for solar energy installations in your area. These incentives can help offset the upfront cost of installing solar panels and increase your overall savings.
Monitor and Maintain Your System. Regularly monitor the performance of your solar panel system to ensure it is operating efficiently. Clean your solar panels periodically to remove dirt, debris, and snow that can reduce energy production. Additionally, schedule routine maintenance checks with a professional to identify and address any issues promptly.
Consider Time-of-Use (TOU) Tariffs. If your utility offers time-of-use (TOU) tariffs, adjust your energy usage to take advantage of lower electricity rates during off-peak hours when solar energy production is highest. This can help maximise the savings from your solar panel system by optimizing self-consumption and minimizing reliance on grid electricity during peak periods.

By implementing these strategies, you can maximise the savings from your solar battery and optimize the financial benefits of generating clean, renewable energy from the sun.

FAQ

The solar panels cost can vary widely depending on factors like the size of the system, location, and quality of panels, but it typically ranges from $10,000 to $30,000 for residential installations.

Yes, getting solar panels in the UK can be worth it due to potential long-term savings on energy bills, reduced carbon footprint, and potential government incentives or subsidies for renewable energy installations. However, it’s essential to consider factors like your location, roof orientation, shading, and upfront costs before making a decision.