Are Solar Panels Worth it in Ireland

Even though we have had a huge shift towards renewable energy, there are still a lot of people under the illusion that solar panels are not worth it in Ireland. Lets bust some common misconceptions below.

If there is rarely any sun in Ireland, how can solar panels work?

This is a common misconception about Solar PV panels – many people think that you need direct sunlight to produce energy and as we all know, sun is extremely rare in Ireland.

The truth is that the term solar panels is used so widely within the renewable energy industry; it is easy to get confused with all the different types and their functions.

Solar PV (photovoltaic) produces its energy from the photons and radiation levels in the sun, not the direct sun rays. What this means is, it will produce energy on overcast and even rainy days.

Before you say it, yes; you will obviously produce more energy in the summer months than the winter months, but this is due to longer daylight hours and higher radiation levels not because there is no sun.

Think about it the sun is out 365 days of the year because, if it wasn’t, we would be in complete darkness everyday. So, even on those dull and drizzly days when all you want to do is curl in a ball and watch Netflix for the day. You can rest easy because your solar panels will continue to produce energy while you binge your favourite shows on the energy that you have produced for free.

So, what will you save with your new solar panels?

On average people see up to 50% savings on their electricity bill. The SEAI are also currently offering a grant up to €2400 for solar panel installs.

Installing solar panels on your roof doesn’t mean that you’re going to be off the grid completely. Most solar systems can’t consistently generate enough electricity to be a home’s only power source, which is why the vast majority of solar homeowners maintain a connection with their utility company.

Plus solar panels only produce energy in daylight hours so you wouldn’t be producing anything on winter evenings or at night – if you were to increase your output from the solar panels to say 95% – it is not advisable because firstly there would be a larger capital spend with longer payback period and a lot of the energy that you are producing would just go back to the grid.

Speaking of the grid, the micro generation scheme is also a saving factor to consider, any energy that you produce and send back to the grid will be paid for by your utility supplier, each supplier has their own rates and term, however, the general rate paid across the market is 15-20c per unit.

One other major development for the solar industry is that the rate rate was reduced from 13.5% to 0% for all homeowners, this reduces the overall installation price by an average of €1,000.

Having solar panels installed can be as efficient as you make it, a change in behaviour about how you use your energy can increase the efficiency of your solar panels. Be smart about how you use your electricity throughout the day – i.e. stagger high consumption household items like dishwashers, washing machines and showers this will ensure that you are using the energy you are producing and not pulling from the grid unnecessarily.

Solar Panel ROI Example

Here’s the ROI calculation for a 3.2kWp solar PV system in Ireland based on the average south facing home.

Annual electricity usage: 5,000 kWh
Unit rate: €0.39/kWh
Annual electricity cost: 5,000 x €0.39 = €1,950

Assuming the solar PV system generates 50% of the annual electricity usage (which is a conservative estimate) and 40% of this is consumed, the savings on electricity bills would be:

Solar PV generation: 5,000 kWh x 0.40 = 2,000 kWh
Savings on electricity bills: 2,000 kWh x €0.39 = €780.00

In addition to the electricity savings, the homeowner could also save money on oil for water heating with the Eddi hot water diverter:

Annual oil cost for water heating: €400

Assuming the Eddi diverts the other 10% of the solar PV generation to water heating, the savings on oil bills would be:

Solar PV generation for water heating: 5,000 kWh x 0.10 = 500 kWh
Savings on oil bills: 500 kWh x €0.16 (assumed oil cost per kWh) = €80

Therefore, the total annual savings would be:

Total annual savings: €780 + €80 = €860

The cost of a 3.2kWp solar PV system in Ireland can vary depending on the specific installation, but a rough estimate after the SEAI grant is around €6,000-€7,000. Assuming a cost of €6,400, the ROI would be:

ROI: €6,400 ÷ €860 = 7.4 years

This means that the system would pay for itself in approximately 7 years, and the homeowner would continue to save money on electricity and oil bills for many years to come.