August 19, 2022
As energy costs continue to rise, you may be in search of ways to reduce your energy bill. As one of the best and most rapidly advancing forms of renewable energy, solar panels are often favoured for various reasons. In this article, we’ll be delving into everything you need to know about solar panels and how they can help reduce your energy bill.
If you’re keen to achieve savings on your energy bill and opt for an environmentally friendly energy option, read on.
How do solar panels work?
Solar panels, also knowns as photovoltaics (PV), use photovoltaic cells to convert energy captured from the sun into electricity. You’ll also have an inverter installed when your solar panels are fitted. The purpose of the inverter is to convert the electricity generated from direct current (DC) to an alternating current (AC), the type of electricity most home appliances use.
If you’re concerned about the great British weather, worry not. Thankfully, solar panels don’t require direct sunlight to work. So, you can expect your set-up to generate electricity even on cloudy days.
How much energy do solar panels produce?
One of the most common questions is whether solar panels can generate enough energy to power a house. The answer largely depends on your household’s energy consumption and the system you invest in. For example, if your household has a high energy consumption and you opt for a smaller-sized system, you may find that you’ll need to top up from the grid for that extra washing machine load or power multiple fridge freezers.
However, if you were to buy a system that meets your household’s energy needs, the amount of energy needed from the grid would be greatly reduced, and energy bills would reduce dramatically. Smaller size systems can still help to reduce the energy needed to be purchased from the grid and help reduce energy bills, albeit less than systems that produce more energy.
So, in short, your best bet is to speak to a solar expert who can recommend the right set-up based on your household consumption.
What are the benefits of solar panels?
In addition to reducing your energy costs each year, there a plenty of benefits to installing solar panels, such as:
- You rely on the grid less; by opting for solar energy, your household will rely on the grid less for power. Even when the sun is not out, you can store energy for the evening. The best bit? Your semi self-sufficient household will be powered if the rest of the street experiences a power cut.
- You’ll cut your emissions significantly; as environmental pressures continue to rise, installing solar panels will allow you to power your home without contributing to the production of greenhouse gases and harmful emissions, which are contributing to global warming. According to the Energy Saving Trust, a typical home solar panel system could save a staggering 1.3 to 1.6 tonnes of carbon every year, depending on where you live in the UK.
- It’s renewable; solar energy is a form of renewable energy. In short, that means the energy supply will not run out unless we’re suddenly without the sun. Unlike fossil fuels – which are currently most commonly used – which are already running out. Not to mention the damage they cause to our planet.
- Solar panels are low maintenance; the standard lifespan for solar panels is around 20 to 25 years, with little maintenance needed. Plus, they’ll generally come with a long-running warranty. So, you can enjoy peace of mind that your product will serve you for many years without significant upkeep costs.
Estimated savings from solar panels
Generally speaking, you can expect to save around £300 per year on your energy bill by switching to solar power. If the wholesale price of energy increases by 77% as predicted in October 2022, then you could certainly see some bigger savings. But, of course, this figure varies depending on location, household usage and more.
Energy saving trust is an excellent resource to estimate how much solar panels will reduce your energy bill. The energy-saving trust offers a solar energy calculator that estimates energy bill saving and financial payments you may receive by installing solar panels.
The tool considers variables such as location, your roof slope, direction and shading and the hours you are typically at home to provide an estimate.
Smart Export Guarantee (SEG) scheme
Thanks to the Smart Export Guarantee (SEG) scheme – launched in 2020 – you can earn money for any excess renewable energy your solar set-up generates by exporting back to the National Grid in exchange for payment.
Any licensed energy suppliers with 150,000+ customers must provide at least one Smart Export Guarantee tariff. Suppliers with less than 150,000 customers can offer a tariff voluntarily.
To be eligible for the scheme, you must meet the following criteria;
- You generate electricity through solar PV panels, hydro, anaerobic digestion, wind turbine or micro combined heat and power.
- Your installation is 5MW capacity or less, or 50MV for micro combined heat and power.
- You’re happy to have a meter fitted, which will provide half-hourly readings to ensure your supplier can monitor how much electricity you are exporting.
VAT savings on energy-saving measures
In April 2022, the UK Government announced that the 5% VAT on solar panels would be scrapped until 2027. To support households in reducing their energy bills and boosting energy efficiency, the government reduced the 5% VAT across all energy-saving measures.
The new VAT-free period also coincides with the permanent removal of all specific eligibility criteria previously attached to the reduced rate of 5%.
The VAT-free period is set to end in March 2027, and the VAT rate on energy-saving measures will return to 5%.
Five tips to get the most of your solar panels and reduce your energy costs
- Be tactile with installation; you’ll want your solar panels exposed to as much light as possible. Ideally, your solar panels should be installed on a south-facing roof at a 10 to 50-degree angle. Furthermore, you should ensure that the panels are positioned to ensure they won’t be blocked by shade from other buildings, trees or obstructions.
- Make use of electricity during the day; because solar panels are most effective during daylight hours, you should use appliances such as washing machine and tumble dryer during the day, rather than overnight if possible. If you’re not usually home during daylight hours, consider using inbuilt timers for your appliances.
- Install an energy storage system; an energy storage system allows you to store any surplus energy generated in the day to use at night. Investing in an energy storage system will reduce your need to use any additional electricity from the grid and ensure your energy bill is kept as low as possible.
- Keep your solar panels clean; although solar panel maintenance is low, you should try to keep them clean to ensure they’re as sufficient as possible. For example, removing any debris blocking the sun will maximise the energy output of your investment. It’s worth nothing that you should try and get your solar panels cleaned by a professional to prevent any accident damage and voiding your warranty.
- Reduce energy wastage; from energy-saving light bulbs and taking shorter showers to draught-proofing your home and investing in double glazing, you can take plenty of small steps to reduce your energy wastage and enjoy savings on your energy.
