How much does installing solar energy cost and is it worth it?

Rising electricity bills are the latest in a series of shocks to household budgets and may tempt people to come to terms with the idea of ​​solar power.

The Australian Energy Regulator (AER) increased its default market offer on Thursday, which is essentially a safety net for customers who have not sought a better deal on their energy costs.

The changes, which come into effect on July 1, are expected to increase bills by $165 a year, or 11.3% in southeast Queensland.

In the Queensland region, a report by the Queensland Competition Authority (QCA) found that electricity bills would rise by 9.2%, or about $119 per year.

in response, Prime Minister Annastacia Palaszczuk last week announced a $175 rebate on electricity bills, which will be automatically applied.

The AER has predicted that electricity prices will continue to rise in Queensland and New South Wales over the next two years.

So, could switching to solar reduce energy costs? We interviewed a panel of experts.

Is solar worth it?

Chris Barnes of Consumer Index Choice, which focuses on solar power and energy, said it was a no-brainer.

“For the most part, a modern house with a good roof that’s not overshadowed by trees or anything – solar panels just make a lot of sense,” he said.

Andrew Reddaway, senior consultant at the Australian Energy Foundation, which aims to accelerate the adoption of green energy, said solar panels can significantly reduce energy costs.

“If you plan to stay in the house for several years and have a sunny roof, solar panels are very economical, especially with rising grid electricity rates,” Mr Reddaway said.

How long to offset the initial costs?

Upfront costs are often a major hurdle for people considering solar power.

These vary, but Barnes said most households would opt for a typical system with a capacity of 6.6 kilowatts, which would cost between $5,500 and $9,000.

“The best value you get from a solar panel system is when you use as much solar power yourself as possible,” Barnes said.

“A system in this kind of price range will probably, in most cases, pay for itself within four to five years.

“In Queensland you’re looking at a faster payback, usually because you’re just getting more sunshine hours in Queensland compared to, say, Melbourne or Hobart.”

Mr. Reddaway has allowed for a slightly longer timeframe.

“It compares very favorably to low-risk financial investments or paying off a mortgage.”

What should be considered before installation?

Mr Reddaway said selecting a reputable solar retailer is vital.

“Retailers often subcontract the job to a local installer, so check in advance how it will work,” he said.

“Installers must be individually qualified by the Clean Energy Corporation (CEC) and retailers are eligible for CEC-accredited Approved Solar Retailer status.

“As with other types of home improvement, word of mouth can be a good way to find a reliable local business.”

Mr Barnes urged households considering solar power to go all-in.

“The panels themselves are relatively inexpensive, costing two to three hundred dollars each.

“A lot of the cost is in the actual work of the installation and it’s technically very difficult to expand a solar panel system years later.”

Is battery storage worth it?

Mr Barnes said he was not convinced a battery was a financially sound option for the average suburban household.

“A lot of people think about adding a battery, the idea being, ‘Well, if I don’t use it during the day, I’m going to store it and use it overnight,'” he said. .

“I would say for most households it’s still not a very cost effective option, just because of the price of the batteries.

“They are still relatively expensive for what they offer and I would say that many houses will not be reimbursed for the lifetime, under the battery guarantee.

Mr. Reddaway echoed his thoughts.

“Some households find it important to maintain electricity supply during a grid outage. For these households, investing in a solar battery can be worthwhile,” he said.

“If you only care about bill savings, it may be best to wait until battery prices come down.

“Batteries can be added to a solar system later.”

What is a feed-in tariff?

If your solar power system produces electricity that you don’t use, it is exported to the power grid for use by other households.

You can get paid for this via a feed-in tariff.