Friday 10th June 2011 - Published by Lara Page - Account Manager

Sunny Outlook Counters Soaring Fuel Bills

With rapidly escalating fuel bills, homeowners are warming to the financial benefits of solar panels, which can substantially reduce energy costs, as well as radically reducing carbon emissions.

Centrica, owner of British Gas, announced last month (May) that the wholesale price of gas and power next winter will be around 25% higher than last year*. This means energy bills are set to rise by an average £200 to £1,500 a year**.

David Ramsay, Director of Green Sun, a solar panel specialist firm said: “Considering the current low interest rates, investing your savings in green energy for your home is likely to have a far greater return on investment (ROI) than investing in a cash ISA or savings account.”

Figures from the Department of Energy and Climate Change suggest that a typical domestic solar PV system could potentially produce around half the electricity needed for a home and can reduce carbon emissions by over a tonne annually*****.

“The benefits of this are clear with large savings to be made on a household’s annual fuel bill. As energy bills continue to rise, the savings made by households with solar PV installed can only increase” added Mr Ramsay.

Under the terms of the government’s Feed-in Tariff (FIT) scheme, launched in April last year, homeowners are paid for all of the renewable energy their homes generate. In addition, any unused units of energy are automatically fed back to the national grid, creating extra payments. ****

Given that these payments are tax-free and index linked, this equates to a real return on a £14,000 investment of 15.6% for a 40% taxpayer and 18.2% for a 50% taxpayer, based on the current Retail Price Index of 5.3%. The government’s FIT scheme guarantees this income for 25 years. ****

David Ramsay continued: “Although it is still too early to put a figure on the added value to a home that is generating a substantial amount of its own energy, it seems clear that this is bound to grab the attention of energy and cost-conscious home buyers.”