Sky high energy prices: should you consider solar?

Back in 2010 the average Aussie paid around $0.19 per Kilowatt for electricity. Fast Forward to 2019 and the average price has increased by over 50% to around $0.30 per Kilowatt. That huge price increase has wreaked havoc on Australian household budgets – particularly in more southern states where heaters often stay on all winter.

With that in mind, solar power isn’t only a greenie’s dream – if you’re willing to make the initial investment it could solve your power bill problems for good. Here’s our quick guide to what you need to know.

THE PROS AND CONS OF SOLAR POWER

PROS

• Can vastly reduce or in some cases eliminate energy bills.
• Low maintenance costs.
• Renewable, sustainable energy source.
• System can last for up to 25 years before needing replacing or refitting.

CONS

• Expensive initial investment.
• Weather dependant – if there’s not a huge amount of direct sun, they generate relatively little energy.
• Storing the energy can be expensive.
• Can take up a lot of space on your house or property.

WHAT SIZE SYSTEM DO I NEED

According to Choice, the average Australia household uses around 20kW of energy per day. If you use around this average amount, a system with 6.6 kW of panels and a 5kW inverter should meet most of your energy demands throughout the day without having to revert to grid-based power.

Take a look at your last power bill or contact your provider to find out how much you use on average every day, then make sure whatever system you install is up to the job. It’s expensive and time consuming to add more panels after the first lot are installed, so it’s always best to get it right the first time round.

HOW MUCH DOES A SOLAR SYSTEM COST?

The cost of your solar system will depend on your location, its power output, efficiency and the brand you purchase, but according to Solar Quotes you can expect to spend:

• 3kW: $3,500 – $5,000
• 5kW: $4,500 – $8,000
• 6kW: $5,000 – $9,000
• 10kW: $8,000 – $12,000

As with anything, there are both cheap and high end solar systems. While it may seem wise to go with the cheapest option, the pricier models often last longer and are more efficient, saving you money in the long run.

HOW LONG DOES IT TAKE TO PAY ITSELF OFF?

According to Choice, the average user would get their money back in energy savings in the following amount of time in each state:

• Melbourne: 5 years
• Sydney: 4 years
• Canberra: 4-5 years
• Perth: 3-4 years
• Brisbane: 4 years
• Hobart: 5 years
• Darwin: 5-6 years
• Adelaide: 2-3 years

So, long story short, depending on the type of system you install and the amount of energy you use, it could take between two and seven years for it to pay for itself. After that it’s all savings!

WHAT ABOUT GOVERNMENT SUBSIDIES?

The STC scheme, otherwise known as the federal solar rebate acts, offers users a large discount off the final price of their solar systems. Solar Quotes says the subsidy is worth around $600 per kW of solar panels installed, so the average 6kW system should attract around $3,600 in rebates (this amount will vary depending on where you live).

The great thing about the rebate is that anyone can claim it provided they meet certain eligibility criteria, including:

• Your system must be less than 100kW.
• The system is installed and designed by a Clean Energy Council (CEC) accredited professional.
• Your panels and solar inverters are approved for use in Australia by the Clean Energy Council.

If you live in Victoria you could be eligible for up to $2,250 more off the cost of your solar system thanks to a handy state-level rebate. However, you should act quick because the federal rebates are slowly being phased out until they stop completely in January 2031.

Installing solar panels is a great way to save money on power and reduce your environmental footprint by using sustainable energy. Do a little research and pick the right system and you could be running on free power in no time.