[Hagar (Doug)]

Originally Posted by clive milne

I'm struggling to reconcile how the feed in tariff for solar can possibly account for such a significant increase... PV's contribute only 1% of the total grid capacity. How can they possibly leverage a 20 or 30% increase in the cost of electricity? If the power companies are making this claim, it sounds highly dubious to me.

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There really isn't a lot to struggle with. I did say partly and at no point tried to account for the full increase. The facts are that any system implemented by an electricity retailer requires not only the cost of the electricity purchased but also a huge number of staff to organise, regulate, oversee and generally manage the buy back program. Oh I almost forgot, make a good profit on each step of the process.


Not sure I agree with this.
Let's say a 1.5kW system is installed in Adelaide which has a solar insolation rate of 4.2kWh/m^2 per day and it costs you $2K. This will knock somewhere between $400 and $600 off your power bill per year depending on your usage patterns. The payback period is around 5 years. If you tack the cost on to your home loan, your mortgage goes up $150 dollars a year and your power bill goes down $500... do the maths.
More importantly though, by putting a 1.5kW system on your roof, you are cutting your green house gas emissions by more than 2 tonnes every year. Solar PV's are still a good deal, just not as good as they once were.

OK lets throw some figures around:
SA you would expect 6.045KWhrs per day with a 1.5KW system and this assumes a perfect setup with the panels being good quality, facing the right way and at the right angle for the time of year. Some manual adjustment may be required between months throughout the year.
Based on these figures and over a billing period of 90 days you could possibly expect 544KWHrs. pricing this at 0.25c ? kwh this equates to $108 / billing cycle.
If you take the $2000 purchase price and add it to your mortgage for a home over a 25 year pay back period it will increase the repayments by around $13 per month for 25 years and suddenly your $2000 commitment is now $3900, almost double. Do the math. 25 years at $150 per year
Suddenly it has become a lifetime venture.
2 Tonns of gas $46 if you can believe the powers that be but I am sure this cost will increase as well.

Following an installation like this you may just make it pay by the time the system is stuffed and needs replacement. Even then 20+ year warranties are only as good as the company who installed the system. If your installer/ manufacturer go broke after 10 years thats all the warrenty you get.


Solar hot water systems are a great idea, but there are other ways to spend your money which offer an even better financial return. Top of the list would be to solicit the services of an energy auditor to give your house (and lifestyle) the once over. Speaking as someone who did this for a living, I can assure you that this offers the best return on investment you can make by a country mile.
No need, my energy prvider provides this as a free service. But alas I still need to implement the advice. Some new whitegoods, some building repairs and modifications. Just hope my mortgage has elastic sides.

Sorry to put it this way Clive and please don't get upset I am not having a go at you but the reality is that with the reduction in the feed in tarrif the incentive to install a system has all but gone and with future increases in the cost of electricity further chewing at feed in tarrif the incentives are reducing almost daily.

Red remarks are mine.