Are Solar Panels Worth It In Ireland?
There has been a significant increase in homeowners installing solar panels on their homes to generate free electricity, heat their hot water and sell excess electricity back to the grid. This is helping Irish homeowners fight against rising electricity and heating bills with a solar panel system from Activ8 Solar Energies.
We want to help you understand why solar panels are worth the investment here in Ireland and explain the long-term benefits and savings of a solar panel installation this year.
Solar panels generate electricity from the sun's energy and daylight, which can help reduce your electricity bills significantly. In addition, the SEAI solar PV grant is worth up to €2,400 and helps reduce the upfront cost of installing solar panels. Further to this, the introduction of the Microgeneration scheme can further increase your savings because you will get paid for the excess electricity that you send back to the grid that has been produced by your solar panels. We want to talk through the upfront costs and expected savings and help you make an informed decision about installing solar panels on your home.
Consider these factors when trying to understand the payback period and long-term savings of solar panels in Ireland in 2022 and beyond:
- Your home’s electricity needs now and into the future
- Size of the solar PV system
- SEAI Solar PV Grant & Microgeneration Scheme
- Comparing Solar Panels to other investment options
Electricity Needs In Your Home
It goes without saying that the larger electricity users will have the opportunity to save more money with solar panels. But that doesn't rule smaller users out either. With your average-sized solar panel system producing roughly 3,700 to 4,000 units of electricity per year, you can save up to 50% on your electricity bills. If you add a hot water divert such as an Eddi, you can expect to generate up to 80% of your hot water needs locking in further savings on top of your electricity savings. If you were to add battery storage, you can expect to save up to 80% on your electricity bills with the opportunity of storing and using the electricity generated by your solar panels later in the day or using the stored electricity to charge an electric vehicle.
The savings and numbers above are year-round estimates with a standard cycle having your solar panels producing more in the summer and less in the winter given the longer days of summer and shorter days of winter.
What Size Should My Solar PV System Be
With the sizing of systems, the general approach was to always design the system to match the electricity demand of the home - but this is changing with the climate action plan in Ireland prioritising the electrification of many aspects of Irish households. With the growing number of electrical vehicles, heat pumps and the introduction of payments for excess electricity being sold back to the grid - it is worth considering larger systems to future proof your home for these technologies and changes.
If you want to install solar battery storage, it is important that this is considered when designing and specifying the amount of solar panels you want to install on your home.
Get Your Solar Panel Grant With SEAI
The most recent change to the SEAI Solar PV grant was a really big one - the SEAI changed the criteria for eligibility. It stipulated that houses had to be built before 2011 to be eligible and now it has been updated to include all homes built before 2021. This now allows a huge number of households to avail of the SEAI solar PV grant up to €2,400 that couldn't do so before this change. It now reduces the upfront cost of installing solar panels for a larger portion of the Irish population.
Get Paid For Your Solar
On top of the SEAI grant of €2,400, the introduction of the Microgeneration scheme allows homeowners to get paid for the excess electricity generated by their solar panels and realise the savings from solar much sooner.
Solar Panels As An Investment
When comparing the investment in solar panels against other mainstream options, this is where solar starts to really excel. When it comes to deposit savings accounts and financial options such as bonds, the returns are less than 1% on deposit accounts and only slightly higher with bonds. The risk on these sort of investments is very very low in comparison to stock market investments where volatility significantly increases your risk.
When comparing these options to solar, installing solar panels gives you a safe return on your investment that has a much higher rate of return. You should expect a return of up to 15% in your first year and with an average inflation rate on electricity prices of 10% year on year, the annual rate of return only keeps increasing. What does 10% inflation in electricity prices actually look like I hear you say? Does that actually happen? Well, according to the **Consumer Price Index report in June of 2022 - there has been a 168% increase in electricity prices since December 2016 and a 40.9% increase since June 2021! Natural gas prices increased by 61% in the 12 months from June 2021 to June 2022 and 171% since December 2016. When it comes to home heating oil - the report outlined a whopping 115% increase in the 12 months up to June 2022 and a 230% increase since December 2016.
Electricity price inflation has been consistent in only one way - it keeps going up.
By installing solar panels sooner rather than later, you effectively lock in 25 years' worth of electricity at a set rate. Once you've broken even on your investment, you get many many years of what effectively becomes free electricity!
Solar As A Force For Good
Lastly, after you've weighed up the financial benefits of installing solar panels on your home, you then consider the impact solar panels have in Ireland's fight against climate change and the need for renewable energy right across Ireland. As a country, we rely heavily on the importation of natural gas to heat our homes and businesses and powering our national grid alongside other imported fossil fuels.
Being a solar panel owner, you become a microgeneration plant of renewable energy and help fight against the insecurity and pollution that comes with imported fossil fuels. You'll also be producing indigenous electricity and supporting Irish SME businesses and jobs. And you'll get paid for feeding your excess green, renewable solar electricity back into the national grid.
**Consumer Price Index — June 2022 Report: https://www.cso.ie/en/releasesandpublications/er/cpi/consumerpriceindexjune2022/