Want to drive two electric cars, cover most of your green home's electricity and still save £150 a month on your electricity bill? If you don't think it's possible, look no further than Giles Parker.
Last year, a 69-year-old man who lives in Ickleford, Hertfordshire spent £9,500 installing 14 solar panels on his east-west roof and two 8.2 kWh solar panels in his garage. Nine months later, he believes he has halved his annual electricity bill and could save around £1,600 this year.
Electricity bills and what can be done to cut them are back in the headlines this week as pressure mounts on the government to stem the impending cut in family support. Starting today, consumers will face rising bills from April, despite Monday's announcement that the industry's price cap will be cut by around £1,000.
Parker, who runs his own digital signage business, is rather unusual in that he and his son drive electric vehicles, meaning his electricity bills are significantly higher than most households. But through careful management of the system, which sometimes requires him to turn on ultra-cheap electricity that charges his home's batteries at night, he has cut his costs and his home's carbon footprint, he says.
While solar panels have been around for years, the advent of affordable home batteries that can save a daily electricity bill and huge price spikes caused by the Russian-Ukrainian war have helped revive a sector abandoned by the government. Feed-in tariffs He fell to his knees when he stopped giving.
MCS, the body that accredits installers, said last week that the number of solar panel installations has doubled this year and is at its highest level since 2015.
Now most of us are paying around 35p/kWh per unit of electricity, nearly triple what they were a few years ago, and prices will rise again in April as households look for ways to save. Utility bills now average £1,200 a year.
“I did this partly to reduce my carbon footprint, but also to save money,” says Parker, whose panels were producing about 1kW when The Guardian arrived on a sunny February day. On the brightest summer day, it rises to 4 kW. By comparison, the most used item in most kitchens, the kettle, typically has a power of 3 kW.
“If we are outside and the sun is shining when we get home, the energy generated is automatically sent to the battery for later use,” says Parker.
“I chose two batteries because you pay 5% VAT on solar panels when you buy them, and I wanted the house to be future-proof. We have a very old boiler that will eventually need to be replaced, an electric stove and a heating pad. When the boiler runs out, I will probably switch to an electric heater, maybe an infrared heater, which requires more energy.”
Parker says most of his savings of £150 a month comes from Octopus Energy's smart electric vehicle tariff, which allows him to charge his home battery system between 11:30 pm and 5:30 am - just £7.5 a year per charged. kWh .
“This means that we rarely buy electricity from the grid at full price [approx. 35p/kWh] if we use a boiler with a capacity of more than 2.6kW, such as most household batteries. It's super easy to manage with an app on my phone, and we now use seven times as much off-peak electricity than we used to charge at full price.
So should we all follow his example?
The problem for others is that panel and battery prices have gone up since the Parker installation.
Today, a system consisting of 4 kW solar panels and a high-quality 9.2 kWh household battery costs around £11,000-13,000, including the inverter and other components.
Prices depend on the size of the roof where you live and the type of fittings you choose.
Of course, if you want to reduce your home's carbon footprint and improve your energy efficiency rating (EPC), this is one of the easiest ways to do so. Once installed, the panels either power the house or charge the batteries and feed excess power back into the grid.
However, if you change your electricity consumption, for example by running your washing machine when the sun is shining and charging batteries at night in winter, most households can now save an average of £1,200 a year on their energy bills. - only €200-€400.
This means a typical payback period of nine to ten years, depending on current prices.
The panels should typically last 25 years, and the batteries have a 10 year warranty, although they should save energy a few years past their 10th birthday, making them a long-term investment worth considering, especially when you're buying a home. I don't have a plan.
A key factor in the profitability of these systems is the determination of the correct electricity tariff.
While most major operators are phasing out the old Economy 7 fares that offer lower overnight rates, Octopus Energy is championing the concept with a range of fares that require customers to charge electric vehicles and, more recently, batteries. Some of the lowest prices during off-peak hours.
A few days ago, the company added a new battery charger called the Octopus Flux, aimed at those with a solar PV installation and a home battery. It is more complex than most existing tariffs and is clearly intended to encourage consumers to avoid buying electricity during the 4-7 pm peak period, when the 49p/kWh charge is normally charged. On the other hand, the company pays households around 40p/kWh per rush hour to plug their panels into the grid.
Households that charge their batteries overnight pay about 21p/kWh — more than the company's smart rate it charges new electric car owners, but less than the daily rate the rest of us pay.
EDF Economy 7 customers currently pay around 47p/kWh for daytime use and 11p/kWh for off-peak electricity, despite only receiving 5.6p/kWh of electricity fed into the grid :
Rebecca Dib-Simkin, marketing director for Octopus, who has installed just 18 solar panels and a battery system at her Midlands home, said the new tariffs have been introduced to cater to the growing number of households installing such systems.
“Customers are now showing great interest in installing solar panels and batteries to store additional energy. From personal experience I can say that it is quick and easy. The best thing is that we only have to pay for electricity about 60 days a year, the rest of the time we use energy generated by ourselves. I hope the installation will significantly increase the value of the house,” he says.
Octopus has recently begun offering solar panels and batteries to people's homes in the Midlands and parts of southern England, and Dib-Simkin said there are plans to do so across the country.
The answer to the question of whether people spending £11,000 or more on such a system would be a bad investment if energy prices quickly fall to levels a few years ago is no.
“I really don't think energy prices will go back to that level,” he says.
Financial firm Investec said it expects Ofgem's price cap to drop to £2,165 from July 1, which we pay in April under the government's energy price guarantee scheme, while the £3,000 cap price drops from £1 July to £2,112 from £2,118 from 1 July. October until the end of the year.
Ultimately, the payback period for these investments will depend on future electricity prices, which may or may not fall after the end of the war in Ukraine.
If prices remain relatively high in the coming years, we would all like to follow Parker's example.
