Are solar panels still worth buying as an investment or has the sun set on solar power?We got our solar PV panels last year just before the FIT (Feed In Tariff) was cut from 45p to 21p. At the time it was a great investment and the speculation has been that the investment is no longer worth it. However in that time the price of solar panels has plummeted again so the investment may still be a good one.
I thought it would be useful to compare the numbers we obtained from our first years generation and run them through the calculations for a solar panels based on the new FIT rates and the current price for solar panels.
We paid £9000 for our 3kWp panels and get a FIT rate of 47p per kWh. These generated 3250kWh which produced an income of £1527
Latest panels look to be available for under £6000 for 4kWp panels and on a roof with the same direction as our 3kWp, should be expected to produce 4333kWh of electricity per year. The FIT income from this would be £693 at the 16p rate.
The payback period for our panels is just under 6 years, but the payback for a new installation at the lower FIT rate would still only be just over 8 years so in many ways still a very attractive investment.
When FIT was first introduced the price of solar panels was £16,000 or more for 4kWp so the price drop has meant that the lower FIT retains the same benefits as those at the time Feed in Tariffs were introduced.