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Why Solar Panel Installation is Booming in the UK

Avatar for Dan Hahn
Updated 08/08/2019
Solar panels on top of a home in London, UK

House roof with regenerative energy system – Solar panels

The solar panel industry in the UK has grown considerably over the last ten years and various green incentives have encouraged investment. The domestic market is thriving while the Government has been helping supermarkets and factories use valuable roof space to make electricity with commercial solar arrays.

The prime mover for making domestic and commercial solar panels more attractive was the introduction of the UK Feed in Tariff. This meant that solar panel owners could sell the energy they produce to the main utility companies such as British Gas and therefore get a decent return on investment.

Britons can qualify for the Feed in Tariff as long as they have used a certified installer to put in their solar panels. There are also other financing opportunities available to consumers such as The Green Deal which provides a low interest loan for installations. In the UK you can find a growing number of installers who are willing to provide your solar panels for free if you want to hand over the long term profits from the Feed in Tariff payments.

The cost of solar is falling

The cost of solar panels in the UK has come down over the last few years with higher and cheaper production as well as greater competition within the industry. A decent sized, high efficiency solar pv 5kW array will cost between £10,000 and £15,000 ($15,000-22,000 USD) but will produce more than enough electricity for a normal sized home with average usage. With the Feed in Tariff and the electricity produced, you would expect this size of array to produce a return on investment within the first five years, with all subsequent payments creating a profit.

For most British homes, a 5kW system is on the larger size and what can be installed obviously depends on the roof space available. Many houses produce a good return on investment with smaller arrays that are in the region of 2-4kW in size. Whilst a lot depends on the location and tilt of the solar panels, you can expect the average 5kW installation to produce in the region of 4,300 kWh over a year.

Feed in Tariffs for solar panels

In the UK, as long as you have had your solar panels installed by a microgeneration certified installer, you will be eligible for the Feed in Tariff. This provides you with a set amount for every kWh you produce, paid for by the utility company.

For smaller arrays it can provide a significant reduction in energy costs and in larger ones you should expect to see a tidy profit over and above the amount you use on a daily basis. The other option is to go for a net metering agreement with your utility supplier which provides a higher payment for every kWh produced but which is more suited for larger arrays.

The UK Feed in Tariff for electricity production via solar panels is set by the government and can vary over time. Currently, for a 5 kW installation on a domestic premises this is 12.57 pence per kWh produced.

Electricity bills are set to rise over the next few years according to most reputable sources which is why many people are beginning to take a long hard look at solar panels as a more cost effective way of getting their electricity. In the UK it is becoming a real option for a number of households and businesses who want to produce clean energy, reduce those troublesome bills, and potentially make a green profit.

For more information on the UK solar panel industry, visit The Renewable Energy Hub

Richard Burdett is the Managing Director of the Renewable Energy Hub and a guest blogger to Solar Power Rocks.

Last modified: August 8, 2019

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