The popularity of solar panels has hit an all-time high in the UK. With concerns over the cost of living crisis mounting, people are looking to renewable energy to save costs and become more sustainable. Can generating your own electricity with solar power save you money – and if so, just how much? Let’s explore solar energy, and whether it’s worth it in 2023.

We’re going to cover:

How much can I save on my energy bills?

The opportunity for savings is potentially limitless, but how much you will receive depends on a variety of factors. These include, but aren’t limited to, your home’s geographical location, the Azimuth (roof direction), roof pitch, roof sizes and, of course, the size of the system installed.

All these factors determine how much solar energy can be generated by your home. If you live in an area that gets more sunshine with a roof that faces true south, for example, you can expect your solar panels to operate slightly more efficiently. If you’re looking to save as much as possible, you might consider investing in a larger array.

How long will it take to recoup costs of solar panels installation?

The break even point of a solar installation can come in as little time as six years for a domestic property. The cost of an installation will vary from home to home, as will the amount of energy that can be generated.

Recouping costs doesn’t just come down to saving on energy bills however – there are other factors at play. For example, installing solar panels will increase your property’s value if you decide to sell.

How much will solar panels increase my property value?

Solar panels are only becoming more and more in demand. Current numbers indicate that their presence on a property will cause its value to increase by between 4.1% and 14%.

They are desirable for a number of reasons. Solar panels are seen as an upgrade, in the same way a conservatory or extension is. Buyers are also attracted to their ability to cut down energy bills, and if they’re already on the roof, it means they’ll save on installation costs. Panels also improve a home’s energy rating, which is good because the government is looking for every home to be rated as a B at least by 2030.

Solar panels across a residential street in the UK.

What is the Smart Export Guarantee (SEG)?

The Smart Export Guarantee (SEG) requires certain electricity providers to pay “small scale generators” for the clean energy they export back to the grid. It was launched by the government on 1st January 2020 after the closure of the feed-in tariff (FIT) scheme.

The SEG applies to solar panels, wind turbines, and select other renewable energy generating technologies. The amount earned from the SEG will depend on the energy supplier, as there is no set rate in place. If you have a battery storage system, you can still apply for SEG, but there is no guarantee that you will get money for exporting “brown” energy from the grid, back to it.

How much VAT do I need to pay on solar panels?

In their 2022 Spring Statement, the government announced that solar panels and other renewable energy technologies are subject to 0% VAT, down from 5%. This scheme is currently set to run for five years, from April 2022 until 2027. It is in part a response to rising energy bills, and is intended to make it easier to substitute energy from the grid with home-generated renewable electricity.

What is ECO4?

If you are a low income or vulnerable household, you might be eligible for the ECO4 scheme. ECO4 is a government incentive launched in August 2022, with the intent to improve the energy efficiency of low income and vulnerable households. The goal is in part to make it easier to pay heating bills, and in part to reduce the emissions of individual homes. To do so, ECO seeks to have medium and large energy companies fund more efficient energy systems for these homes.

Solar panel installation is a potential benefit of the ECO4 scheme. Unfortunately though, you will only be eligible for it if it is not possible to install a heat pump or biomass boiler in your home. The fourth and final ECO scheme set out by the government, ECO4 is set to run until 31st March 2026.

Many solar panels delivering a home energy and saving on bills.

What happened to the Feed-in Tariff (FIT)?

The Feed-in Tariff (FIT) was a government initiative to pay for the renewable energy that households exported back to the grid. It closed in July 2019 and was replaced by the SEG in January 2020.

Households that applied for the FIT prior to April 2019, will still continue to receive payments until the end of their contract. These are usually set to last around twenty years. If you seek to sell your home before the end of your contract, then the tariff will usually pass onto the new owners, but depending on what the contract says, you may be able to take it with you to your new home.

What happened to the Renewable Heat Incentive (RHI?)

The Renewable Heat Incentive (RHI) was a government initiative to encourage the adoption of renewable heat. Launched in 2011, the scheme finally closed on 31st March 2022.

Those who joined the scheme would receive payments quarterly for the clean energy their home would be expected to produce. The contract lasts for seven years, so those who signed up towards the end are still receiving payments.

What kind of financing is available to me?

If paying for your solar installation in one lump cost is too daunting, then there are financing options available to you. Joltify has partnered with Phoenix Financial Partners to help make solar power accessible to everyone.

From 10% APR representative, you can spread the cost of your installation over three to ten years. Try Phoenix’s financial calculator here to find out if this offer is right for you. You are, of course, welcome to arrange your own financing too!

Phoenix Financial Consultants offer financing from 10.9% on solar panels.

If you’re looking to install solar for your home, then contact us now to get an estimation for your property within just 48 hours!