back of a fag packet maths

4kW south facing system in UK , simple install inc vat £10,000

estimated annual output 3,434 kWh/y

25 year life of system , grid electric with no service charge 14p kWh

25 x 3,434 = 85,850 kWh x 14p = £12, 019 ( £10,302 if 12p kWh grid electric with service charge )

So PV in the UK is cheaper than grid electric if you can use or store this energy , whether you get /grants/FITs or not

this doesn't take into account reduction in output of PV panels over time period ( 2-20% ), loss in potential alternative capital investment, grid electricity inflation, Pv system maintenance
and importantly ability to use and store all output .

Ok you lot , let me know where I've got it wrong

yes, forgot that bit , so edited above
But if , for a larger building , say a office, with high constant usage , the numbers work ?

On the topic of batteries, I agree, they are a nightmare! However, a friend of mine is off grid and is now using PV and wind to charge a big array of Chinese made NiFe cells and these are proving to be exceptionally good. They have a life of many tens of years and are virtually indestructible, all they ever need is a top up every now and again. The downside is that they are big and heavy for their capacity, but not overly expensive if bought direct from China.

<blockquote><cite>Posted By: CWatters</cite>Note the warning about NOT using a constant voltage charger. That probably means you can't just substitute a lead acid battery for one of these.</blockquote>

No, you have to adapt the charge profile to match the cell voltage and constant current charge characteristics, but this is usually fairly easy to do, as a lot of off grid stuff has provision for setting profiles for different battery types.

NiFe cells have been around a long time, I recall that they were used to run some high speed 35mm cameras (c 2000 fps) we had back in the 70's; these needed around 200A or so to start, so were always run from a big crate of NiFe cells.

You would have to take into account some 'infant mortality' of equipment, which front loads maintenance costs.

But another way to look at it is what could you do with the £10,000 with regards to electrical energy use.
If you invested the cash at even 2% and used that annual payout of £200 to buy E7 rate electric at 6p/kWh, you could buy in 3,333 kWh, so pretty close to what your 4kW PV system is providing. And you still have your initial £10,000 which you do not if you buy a PV system.

The second part of this is the convenience factor, with E7 (or other cheap tariffs). With E7 during the summer you can store energy as hot water, in the winter you can store it as hot water and in storage heaters for space heating. PV does not really allow you to have as much control over when you can store. In the summer, you will almost certainly be over producing and are very limited on local storage, in the winter you will be under producing and have to supplement with other resources. So by using E7, you can control your supply to when you need it (I use somewhere between 4 and 7 kWh/day for water heating, day in day out (1.5 to 2.5 MWh/year)), and guess what, you still have your £10,000.

Future cost of PV installation are very hard to predict, though on current trends they will probably come down for the hardware but not for the installation. Future grid energy costs are also hard to predict, but the trend over the last 40 years has been downward (though personally I would like to see them goign upward for combustion technologies).
What you can say with some certainty is that neither industries are going to price themselves out of the marketplace. Legislation is making sure that with will not happen, CfSH for PV and Fuel Poverty rules for Grid Supplied power.

If you want the price of PV to come down, the best way to achieve this is to not buy it at the current going rates, same with everything else you may want to buy. And guess what, if you did that, you would still have your £10,000.

It is a bit unfair to compare the cheapest electricity rate with the most expensive just as it is unfair to compare the cheapest PV installation with the most expensive electricity rates. The same applies with past and future energy costs, not good comparing the costs of today's prices with 18 months ago while at the same time comparing the expected costs of future PV installations with the price they were 20 years ago.

One thing that the latest decision by DECC has shown us is that things can change very quickly and not always for the better (from our point of view).

Side note: E7 depends on nukes that can't load-follow needing somewhere do dump their energy at night when demand is low: thus the *real* cost of E7 is a matter of debate. But unless we get our skates on and build more nukes in the UK quickly I can see E7 going away or being neutered within the life of a newly-installed PV system!

(Sider Note: the GB grid often seems to prop up France at its peak times because its nukes can't load-follow much, and recently I've seen what looks like us propping up Germany too indirectly because their nukes are going off, ie both the French and Dutch interconnectors running at full tilt exporting to the Continent except for a few hours around our peak. Over the last couple of days it's all being coming our way though, possibly because wind is low...)

Rgds

Damon

Posted By: fostertomWhat about over the last 8yrs?

That is the nub of the problem really when talking about 'investment', my 2% interest scenario may well change to a 5% scenario in 8 years time (or some other time), but either way I would still have the initial sum of £10,000.
There does come a point where customers stop buying, so the price decreases (what this recession is showing us, all be it rather slowly). If you think that energy prices are going to follow the same increases that have happened over the last 2 years or so every year, then energy prices will double in 5 years, triple in 8 years, quadruple in 10 years and be 10 times more expensive in 16 years. At that kind of increase and knowing that the Fuel Poverty level is set at 10% of household income, that would mean that people that are in fuel poverty today would be spending all their income on energy. Just not going to happen like that.

Posted By: DamonHDI can see E7 going away or being neutered within the life of a newly-installed PV system!

A very valid point, and rather a problem for smart metering, which relies on the variances of the grid mix at different time. Though if smart metering really charged the true cost of power today, then PV would be charged at 41p/kWh to be used during the daytime, as that is what is being paid out to generate it.

Is the grid interconnects loads really to do with decommissioning of some European nuclear capacity or is it just routine maintenance, weather conditions, overall higher demand. If we have a grid connection it makes sense to use it to full capacity (in either direction) than at part load. Is it paid for by the GWH/year or for just 'being there'?

"you can still claim the state pension" that's my plan A not thought of another yet,
though dont expect it to be there in 30 years.

How about forget FITs / MCS etc . DIY install 4kW for £6,000-7,000 ,
this will make PV clearly cheaper than UK grid.
Not sure how this works with connecting to grid. I presume network operator will only allow MCS registered jobs to connect to grid.
If a skilled, competant was allowed to connect the equipment, forget FITS , just let people get on with it.
You can fit your own gas boiler if it takes your fancy , why not PV .

Steamy Tea,
>>Just not going to happen like that.
Costs of fossil based energies will follow FosterToms predictions. To call it other wise must require foresight. Here and now, no new FF discovery coming on line is cheap (all this new oil they find in the USA costs around 80USD per barrel, the NG deposits ramp up quick, but the 5+ year live span of these deposits is not looking good, its still not proven to be cheap/expensive ). Hindsight, is pretty lucid, so expect at least a doubling in price. Historically, any finite asset follows a bell curve. Common knowledge i thought. FF is at the top of said curve and no replacement has been actioned in a scale needed to replace it.

Also many would need to install the devices to capture the cheap E7.

The government always have a way to deal with hand outs that cost money, cut them. In the USA, thats exactly whats happening to their fuel poverty equivalent hand out this winter.

You have excluded the effect of inflation on your 10k. That may rise to beyond 5%. Especially if FF production does not increase, as supply and demand will push FF prices higher, as is the case now.

The PV will generate revenue onward, whereas 10k in most non risky investments is losing money due to interest being less than inflation. John Maynard Keynes will be shaking his head at your desire to not put your money to work.
pretty clear to me, insulate house, put PV in. or follow your advice and buy some down/fleece pyjamas.
Good piece of devils advocate tho.

many non financial software writers could do that software, doubt one versed in working the city would want the pay cut doing software in non banking would lead to.

http://www.guardian.co.uk/business/2011/nov/07/friendsoftheearth-solar-panels-consultation-lawsuit
Interesting development

Posted By: alexcYou have excluded the effect of inflation on your 10k

That is true, but the £10,000 would still be there, the purchasing power would be different.
I looked at ISA rates, you can get fixed for 3 years at 4%, maximum put in as cash is £5430, so two people in a house can put money into an ISA and do quite well (if you think inflation is going to decrease from next year).

While I was doing that I thought I would look up some numbers on Electric prices (from DECC), Mortgage prices (from www.ukmortgageandloan.co.uk), RPI (from DECC) and Wages (from FT). Now this is very limited and crude data, just yearly averages, but highlights the problem of predicting future trends in inflation in those sectors. The interesting one is Mortgages, they should hit zero by 2030, this does not come as a surprise to me as they were on a downward trend, volume traded has collapsed in recent years and they are of limited life (not many last more than 25-30 years). So if you took out a home loan in 1996 that was double your household income, then come 2017 it will be about a third of your household income, seems reasonable to me.

Electric prices are looking to become 3.6 times in 2030 what they were in 1996, your wage will be 2.6 times greater. So if you used 10 MWH in 1996 at £0.10/kWh (£1000/year) you will in 2030 be paying £3600/year.
If you were earning £23,000/year in 1996 (the median household wage) you will be earning £59,800 in 2030.
That works out as 4.3% of your wage goes on electricity in 1996 and 6% in 2030.

All very rough and ready and based on very limited data, but a bit more realistic than taking the last 2 or 3 years increase in one sector to prove a point in another. Economics is known as the dismal science, bit like the weather today.

So the £10,000 put under the bed in 1996 will be worth £4550 in 2030

James - you can fit PV and connect to the grid without going through MCS. The installation just needs to comply with G83/1 (and the wiring regs) and that's easy - your inverter will do this. Your DNO/supplier may be rather confused by a non-MCS installation but it is permitted.

As Wookey says, you don't need MCS for grid connection. However, MCS does bring you more than just FITS: the install is at 5% VAT whereas materials for a DIY install are at 20% VAT. Non-MCS/DIY only makes sense for a new build (0% VAT) as far as I can see.

Or, perhaps, if you expect to move and take the installation with you with the intention of claiming FITS at the new site (and have a tame MCS installer who will be involved) but that would be a pretty odd case.

I agree with the sums and it wont be long before the kit all gets a lot cheaper again making it easier

We could solve the energy problem this way so long as a storage system can be found

ROI = return on investment

Every pension fund should be doing it! none of them are getting 7% (except mine)