Six months into their solar experience, Angie is confident it will pay off, financially and environmentally. The system cost about $12,000 after the federal government rebate. That's expensive in today's solar market but they bought top-grade panels manufactured in Canada rather than the cheaper Chinese ones.
Angie says they're looking to the long term: the system will add to the resale value of their house if they ever leave. She also hopes that one day they will use their excess power to charge their own electric cars. Another possibility, if the feed-in tariffs for solar power continue to drop, is to go off the grid entirely and to store their own electricity in battery packs.
They have already had their first account and earned a $250 credit. The credit plus the savings on their electricity bill easily covered the extra they borrowed on their mortgage to pay for the system.
Then there’s the environmental payoff. “Some people say climate change isn’t happening,” Angie says, “but you can’t discount the impact we’re having on our environment, whether it’s the amount of waste we’re producing or the pollution. We all have to look at the way we’re living and make some changes.”
Like the Lowers, after years of weighing up the pros and cons of solar power, many people have decided to bite the bullet. Across Australia, about nine per cent of houses had solar systems by April 2012. Walk around Wonthaggi, Inverloch or Cowes and you’ll see panels in every combination possible: on sloping house roofs, on roof frames, and even on sheds. According to the Office of the Clean Energy Regulator, there were 1948 solar PV systems and 1356 solar hot water installations in Bass Coast by January 2013. Most have been installed in the past year.
When even the Wonthaggi Bowling Club is getting in on the act, you can guess solar power is no longer the province of greenies and hippies. The club recently installed 24 panels generating 5 kilowatts an hour. Treasurer Dennis Stanes said they started investigating solar power last year because the club's power bills were horrific - $1500-1900 a quarter. The timing was good: a grant of $5000 from the council paid for more than 50 per cent of the cost of the project. They also got rid of their old power-hungry stove and changed over to natural gas. They are now awaiting their first post-solar electricity bill.
Three years ago, when I signed up for a solar system, they retailed for about $10,000. At the time, the federal government was offering a $8000 subsidy. So generous was the subsidy that my super fund offered a scheme where you paid a $1000 deposit then got it back after your system was installed. The system cost you nothing!
At the time I thought paying people to do something in their own interests was a daft waste of public funds. Now I can see it brought a critical mass to the industry. There was an influx of suppliers and installers. Panels now cost about a third of what they did just three years ago.
Perhaps most importantly, the spread of panels helped to ease people’s fears about the new technology. We had heard so many stories: the panels and inverter were fire hazards; they could electrocute you; the power was useless because it was intermittent; it took more energy to produce the panels than they actually generated.
There were stories of people whose bills actually went up after they installed solar panels because they lost their off-peak discount. A work colleague warned me solar power wouldn’t produce enough electricity even to run my fridge.
It was about 14 months before I got my first bill. When I did I was more than $600 in credit. In the 11 months to April, 2012, my 1kWh system – a minnow by current standards – generated 1473 kilowatts, just over double what I used. So much for that energy-hungry fridge.
My solar system is good for me, but is it good for the environment? Is it true that it takes more energy to produce a solar panel than it generates? An Energy Bulletin review of multiple studies in 2006 showed the energy payback time to be between one and four years, depending on the panels. Panels are expected to last at least 25 years and all components – glass, aluminium and silicon – are easily recycled.
Solar power capacity in Australia has doubled on average every year for the last five years but still accounts for just 3.2 per cent of Australia’s electricity generation. Does it have an impact? Last December, following a 40-degree heatwave across much of Queensland, the head of power company Ergon said peak demand had fallen 14 per cent since a similar heat wave two years earlier, largely due to solar power units on private homes.
The arguments are stacking up. But before you go ahead, you need to consider a few factors. The orientation of your roof is crucial: north-east, north and north-west are all good. If you have to choose between east and west, go for west, according to Solar Choice, a solar energy broker. There tends to be more sunshine in the afternoon and around 5pm is also a peak period for energy consumption. If your only option is a southerly roof, forget it and look for somewhere else – a shed, perhaps – to put them up.
As to cost and payback times, government rebates and feed-in tariffs are changing so rapidly that I suggest you ignore them in your calculations. Anything you get will be a bonus.
My retailer is asking $3299 for a 1.5 kilowatt system that should generate about 2400kWh a year. Based on the 30 cents/kWh peak and 16 cents/kWh off-peak it costs us to buy our electricity, you'll save between $400 and $720 a year. That’s equal to between 12 and 21 per cent on your investment. If your bank offered it, there’d be a queue outside. The equation will only get better as electricity prices rise. At the moment you'll also earn a feed-in tariff of about 8 cents a kWh for any excess electricity you produce.
The final factor you need to be aware of is that you're going to have to put in some hard yards mediating between your electricity retailer, your electricity distributor (SP Ausnet in our case), your solar power company and possibly your local installer.
Everyone I spoke to for this article had received information that was misleading or just plain wrong. Everyone had to overcome obstacles along the way.
The bowls club had to appeal to the Energy Ombudsman after its electricity company said it was not entitled to the 25 cents/kWh tariff it had promised. The club won its case.
Angie and Jim Lower’s solar company told them their house was north-facing – ideal for solar panels – but when the installers arrived they said it faced north-west so they lost about 8 per cent of productivity. They had also been told they could have all 12 panels on the front roof but they didn’t fit, so some had to be installed on the north-east side, which meant cutting down a favourite lemon scented gum that was shading the roof. To make up for the error, the company agreed to put another couple of panels in for the same price.
They were told they would need only a small upgrade to their meter box but then found they needed a new meter box costing $1200. Angie rang the installers and said “I’ve still got your cheque – you’d better come and take the panels off.” At which point the installers backed down. Her message” “You have to watch what's happening and be prepared to stand your ground.”
Which brings me to my own case. After two years of generating electricity from the sun, or so I thought, I was told last week by my electricity retailer that SP AusNet had told them my system had never actually been connected to the grid. Our discussions are a work in progress.