Consumers ‘will lose out’ in free solar panels deal
Shropshire, UK, August 2010 – Following the recent publicity given to companies offering consumers ‘free’ solar panels that will save them money on their home electricity bills, a solar energy expert has warned that homeowners will lose out on tens of thousands of pounds under the generous-sounding deals. Richard Drinkwater, a director with solar energy specialists Mipower Ltd, based in Shrewsbury, Shropshire, expressed his concerns at how consumers will be missing out on the Government’s generous package of financial incentives. “Effectively, customers using a company offering ‘free’ solar PV (photovoltaic) systems may be getting around £230 of free electricity per year, but may not appreciate they are giving away a cash income of more than £35,000 over 25 years - from a system that would cost around £15,000.” “This is because they are, generally, not revealing how much the Government’s Feed in Tariff (FiT) will pay them every year. “Using Government figures, for a retro-fitted, a south facing domestic solar PV system that produces around 4kW of electricity (at peak), the homeowner can expect to receive an annual cash payment of £1,413, plus free electricity. “This Feed in Tariff is guaranteed by the Government for the next 25 years, it is index linked, so it will rise and is also tax free. “It will typically pay back the cost of a 4kW system within 10 years. In fact a recent customer had a 2.6kWp system fitted at a cost of just over £11,000. He paid a small deposit and borrowed over £9,000 from his Building Society. He got a GOOD five-year deal which costs him JUST OVER £170 pcm and he knows that after 5 years the system is his. “Under the ‘free’ deal, the only real benefit that consumers will get is a saving of around 40 percent, worth maybe £200 to £300 per year on their annual electricity bills, leaving their solar PV system supplier to pocket the full Feed in Tariff, plus a further export tariff.” Drinkwater went on to say that the ‘free’ systems would also necessitate a Charge being placed on the deeds of the house, effectively saddling the homeowner and any future owners with the unfair deal. “It’s another added problem when a homeowner goes to sell their house and may put prospective buyers off.” “What would be far more attractive is to sell a house with the benefits of the Feed in Tariff - say a guaranteed tax free annual income of £1,400 that the new owner would enjoy. “Consumers should be given options and I would urge any homeowner to think twice before entering into one of these ‘free’ deals as there is much to lose. Ideally, if they can obtain competitive finance with a good rate of interest, they stand to make money over the longer term and save the planet in the process!” The Feed in Tariff has been available since the 1st April 2010 and it is designed to boost the use of renewable energy in homes and businesses. This will offer benefits to energy consumers in the form of lower bills and substantially reduce the greenhouse gas emissions that have been proven to be a contributing factor towards climate change. For further information, please visit http://www.mipower.co.uk ENDS
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