This guest post is by Simon Colley of http://www.renewablesguide.co.uk.
Solar photovoltaic systems better known as Solar PV are still proving to be a sound investment despite the latest round of cuts to the solar feed-in-tariff.
Solar panel electricity systems have excellent green credentials; capturing the sun’s energy using photovoltaic cells doesn’t emit any CO2 making it an incredibly environmentally friendly technology.
For those home owners who are thinking about installing a renewable technology to generate electricity, but are yet to do so, should not discount solar pv systems. Despite some of the negative press that has been published in recent months as a result of reductions the Government has made to the solar feed-in-tariff, home owners should not be put off installing solar pv systems as a way to generate electricity.
The latest round of cuts is a natural progression of the feed-in-tariff scheme which is not exclusive to the UK. Any subsidy scheme needs to be sustainable over the period of time it runs and therefore reductions in tariffs are common place. However, the justification for the reductions is the significantly lower investment costs to get the technology installed and up and running, meaning that in the long term there are still financial benefits for businesses and home owners.
As recently reported by Solar Guide, even in the last 12 months the cost to install a solar PV system has fallen considerably. Take a 4kWp system, today the cost to install this type of system typically ranges between £7,000 and £8,000, compared to one year ago when it would have cost approximately £13,000. While the feed-in-tariff rates have fallen it’s savings like this which still makes investing in solar energy worthwhile as fantastic returns can still be gained.
The benefits of using solar pv systems to generate electricity continue to impress and prove a great return on investment opportunity. Home owners and businesses opting to install solar technology can dramatically reduce their electricity bills and significantly reduce their carbon footprint – a typical home using a solar pv system can save over 1 tonne of CO2 per year according to the Energy Saving Trust. There is also the payments that can be earned by installing an eligible system through the solar feed-in-tariff, which currently stand at 16p/kWh, plus there’s the opportunity to earn more if you produce more electricity than you need as you can export it back to the national grid at a rate of 4.5p/kWh.
When you see reductions in the solar feed-in-tariff plummet from 43.3p to 21p, which is what it was up until December 2011, and from 01 August it’s dropped further to 16p, it’s no wonder the initial reaction has been alarming, but once you dig a little deeper there is proof that there are still great returns for those wishing to start producing their own renewable energy using solar technology.
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