With energy costs set to remain a major household concern this winter, Irish consumers are increasingly looking for investments that deliver measurable savings.
For many of us, that means considering doing what more than 200,000 homes across the country have already done and installing solar panels.
The numbers are certainly growing. According to the Sustainable Energy Authority of Ireland (SEAI) which administers renewable energy grants, the first seven months of this year saw more than 31,000 grant applications for solar photovoltaic (PV), up 76 per cent on the same period last year.
With oil, gas and electricity prices set to rise, not least because of the Iran crisis, it’s little wonder.
RM Block
Under the Government’s Micro-generation Support Scheme, homes can sell any excess electricity they produce from their solar panels back to the grid, resulting in a payment known as a clean export guarantee (CEG).
The amount you get paid depends on your energy provider, but it’s currently around 19.5 cents per kilowatt hour (kWh). That compares to a standard charge per kWh of between 36 cents and 45 cents.
On top of that, you can earn up to €400 a year from your export payments tax-free.
The SEAI provides grants for the installation of solar PV, which typically cost between €6,000 and €9,000 for an average Irish home, after the grant of up to €1,800 is deducted.
The SEAI website lets you see how much you can save by installing solar panels, and how long it will take to see a return on your investment – typically between five and eight years.
Currently, not alone are more people looking to install solar panels on their roofs than ever before, they are looking to install more panels when they do. That makes sense, says Abhilash Borana, founder of Fáilte Solar in Shannon, Co Clare.
“You have to fill the roof as much as you can, because whether you put on six or 10 or more, the labour costs are nearly the same and you’re getting the VAT free,” he says.
Solar panels come at zero per cent VAT when supplied and installed together under a single contract by a professional. That rate applies for the entire package, including ancillary kit such as inverters – which convert the electricity produced by solar panels to energy that can be used by devices – as well as controllers, wiring and batteries, and labour.
SEAI grants for batteries were withdrawn in 2022 but prices have fallen since then, making them compelling regardless. Once you have a battery, you can store up energy generated by your solar panels and use it later.
Given the difference between the cost you pay per kWh, and the amount you get under the CEG, the most economical thing you can do for your household is use as much of your own energy as possible.
It’s why Borana reckons householders shouldn’t worry too much about speculation that the CEG may be reduced, or even abolished as happened recently in the Netherlands. “You’re better off ensuring every bit you use is stored and reused at a time that you don’t want to take from the grid,” says Borana.
Ronan Power of Solar Ireland, a representative group for the industry, agrees. “My recommendation to people is to always consume as much as you possibly can onsite. Once your system is paid down, in and around the five-year mark, you’re then generating at zero cost,” says Power.
He believes the Government would be unwise to diminish the CEG in any way. If anything, he believes it should be increased, given the value it has as an inducement.
“My own father has a WhatsApp group with all his other buddies who have solar and during the summer months these men, who are all in their 70s and 80s, text to slag each other off about the fact that their system did better than the others,” he says.
Ditto with his father’s electric vehicle (EV). “On sunny days he’ll ring me up and say, ‘I’ve just got 500km for free’,” says Power.
Installing heating controls in your home, which match your heating and hot-water schedules to the way you live, is another good investment, and one for which the SEAI will provide a grant of €700. It can help you prioritise specific zones for heating, for example, rather than heating the whole house in one go.
A combination of app-based information from your energy provider, and time-of-use tariffs, also help you save money by identifying big energy users and simply changing the times you use them at.
As demand for solar grows, so too is demand for batteries. According to Alan Burns of ePower, a nationwide installer of Solar PV and EV chargers, the batteries being sought are getting bigger too. “Just 18 months ago the average size of a battery we were installing was 6kWh. Now it is 9.6 kWh, a more than 50 per cent increase,” he says.
He believes the best way to view such investments is as just that, investments, ones that won’t show a return for some time, but which, compared to leaving money in the bank, add up. It also gives homeowners more control over both costs and supply, in an uncertain energy environment.
Burns also believes it makes economic sense for people to put up as many panels as they can. “I’ve never had someone come back to me saying they wish they got less panels. But I’ve had plenty say they wish they had put up more,” he says.
