Are Solar Panels Worth It in 2022?

The value and worth of installing solar panels can vary greatly depending on individual circumstances. In my case, I found it essential to weigh the initial investment against the long-term savings and environmental benefits. Here’s a detailed examination of the potential worth of solar panels, including insights, data, and considerations to help you decide if solar is right for you.

Initial Investment vs. Long-Term Savings

A 5-kw grid-tied solar power system for my household cost around $21,000. If we had not purchased this system, what other investments or purchases would we have made instead? These might include leisure activities, travel, or alternative investments, which, post-tax, would yield significantly less annually than the utility savings generated by the solar panels.

After the initial capital expenditure, the system has provided substantial benefits. My household now receives approximately 7,000 kWh of power annually, reducing my utility bill by around $1,000 per year. Does this make it worth the expense? In my personal experience, it does. However, this number varies, as detailed below.

Factors in Determining Cost-Effectiveness

The question of whether solar panels are worth it cannot be accurately answered without considering several key factors. These include:

Local electric rates Hours of good sunshine or days per year for a specific location Size of the system (5kw in my case) Cost of the system Desired payback period

With these factors, a simple calculation can help determine the feasibility:

For example, the payback period for a well-designed solar system can range from 3 to 20 years, depending on the initial investment and the amount of savings achieved.

Ultimately, the goal is for solar energy to provide a wise investment for you!

My Specific Case Study

In my home, an average UK household uses 3.7 megawatts of electricity per annum, whereas my household, often consisting of 5 to 6 people, uses 1.7 to 1.8 megawatts per annum. Although statistically, we should use at least 7 megawatts, our current system, consisting of 4 separate 2.1 to 2.2 kw grid-tied systems oriented in different directions to balance power throughout the day, significantly reduces our electricity bill.

With a 40-kWh battery pack and a solar diverter, any excess power generated is not sent back to the grid but instead used to power electric night storage heaters, which in turn helps reduce our gas heating bill. This results in a significant annual saving of around $2,000, leading to an estimated annual bill of around $600. Moreover, the gas savings are also substantial, with an estimate of around $500 annually.

It's important to note that standing charges are still a factor, but they can't be avoided unless we go completely off-grid. Nonetheless, the overall savings from the solar system are noticeable and justify the initial investment.

Conclusion

The worth of solar panels in 2022 depends on various factors. While the initial cost might seem high, the long-term savings and environmental benefits can make it a worthwhile investment. Conduct a detailed analysis of your electricity rates, local climate, and desired payback period to determine if solar panels are right for you.