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Are solar panels worth it in 2024?

Emma Spencer
Written by  Emma Spencer
5 min read
Updated: 07 Feb 2024

They’re increasingly common, but are solar panels worth the outlay? Will they save money on bills and do they offer good value with other low carbon energy options available? Read on and we’ll explain everything you need to know about buying solar panels.

In a world where renewable energy is becoming increasingly crucial, solar panels are often touted as a beacon of sustainability. But as with any investment, it's essential to understand the costs and potential savings involved. Let's delve into the financial aspects of installing solar panels and whether they're a bright idea for your wallet.

The Price of Going Solar

When considering solar panels, the first question for many homeowners is: How much will it cost? The answer isn't one-size-fits-all, as the price tag is influenced by the size of your home and the system you choose.

Initial Investment

According to the Energy Saving Trust, the average solar panel system in the UK is 3.5kWp, with an overall cost of £7,000. That can rise to as much as £9,000 for a 5kWp system if you have a larger home. These figures include the panels themselves and the installation costs, which can be substantial. Specialist labour and necessary roof access, such as scaffolding, are additional expenses that must be factored into the budget.

Long-Term Savings: A Sunny Outlook?

The upfront cost of solar panels is undeniably steep, but the long-term savings can be substantial. On average, a home might take about 15 years to break even on their solar panel investment. This detail is important as it sets realistic expectations for homeowners considering the switch to solar energy.

Renewable Energy and SEG Benefits

That might seem like a long time, but it’s worth remembering that solar panels can provide all of your energy needs, making your home potentially energy self-sufficient. Additionally, you can take advantage of the government’s smart export guarantee (SEG). This allows you to sell back energy you don’t use to the National Grid. The SEG replaced the more generous feed-in tariff, which paid solar panel owners a price for all the energy they generated, whether it was used by them or returned to the grid.

Comparing SEG Deals

Different suppliers offer varying SEG deals, so it's advisable to compare options. Suppliers offer different prices for SEG deals, and it pays to shop around to find the best one for your needs. For those who plan to stay in their homes for the long term and have the financial means, pairing solar panels with solar batteries can lead to significant savings, though it will extend the time to break even.

Value for Money: Are Solar Panels Shining Brighter?

Over the past decade, the cost of solar power has halved, making it a more attractive option for homeowners. The International Energy Agency hailed solar power as offering the cheapest energy in history in 2020. With gas prices on a rollercoaster and climate change concerns mounting, solar panels are expected to become even more cost-effective in the future.

Cutting Down on Bills with Solar Power

After installation, solar panels start saving you money on energy bills immediately. A standard 3.5kWp system can save you anywhere from £150 to £565 annually, depending on your energy consumption and reliance on the grid. The range of savings provided depends on whether the system can offer all of your power or if you will need to pay for some from the National Grid.

Earning Through SEG

If you are generating enough energy, you can sign up for a SEG tariff, which will see your supplier pay you for the energy that you generate. You can sign up via the government website and then decide on a supplier.

The Role of Solar Batteries

Solar batteries are an additional investment that allows you to store surplus energy for later use or to sell back to the National Grid. Starting at £4,000, solar batteries mean a longer time to break even when combined with the cost of solar panels. However, for those aiming for energy self-sufficiency, they are a valuable addition to reduce reliance on the grid and lower bills further. If you want to be fully self-sufficient in terms of energy, solar batteries are a great way to keep the energy you generate and slash bills in the process.

Conclusion

Investing in solar panels is a decision that requires careful consideration of the costs, potential savings, and your long-term energy goals. With the price of solar technology decreasing and the added benefit of SEG, solar panels are becoming a more enticing option for homeowners looking to reduce their carbon footprint and their energy bills. For more ways to save on energy, read our energy saving tips.

As the sun sets on our exploration of solar panel costs and benefits, it's clear that while the initial investment is significant, the potential for long-term savings and sustainable living shines bright. Whether solar panels are the right choice for you will depend on your personal circumstances, but for many, they represent a step towards a greener, more cost-effective future.

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