Before the launch of the feed in tariff in early 2010 there was a lot of confusion about the free solar panel offers being touted by several companies. Many people understandably thought there must be some sort of hidden cost involved. So are free solar panels a scam?
With the lunch of the feed in tariff and clarification from currently one of the pioneers of free panels A Shade Greener we were able to see exactly how this offer was going to work. In essence the reason companies could install these panels at no cost to the consumer was the fact that the installer is able to claim back a tariff through the governments scheme which replace the previous solar panels grants available.
Effectively this subsidised the cost to the installer. Although they would have to pay the upfront cost themselves they would soon earn that investment back plus a hefty tax free profit to boot.
For this to work companies would have to entice homeowners into letting them use their roof space to place their panels. As an enticement they offered free solar panels, or to be more precise the free electricity generated by those panels. Technically the company would own the panels for 25 years after which ownership would usually pass to the homeowner.
At this point they should still be expected to be generating free electricity for the homeowner. The actual tariff is guaranteed for 25 years but if the tariff or it's replacement scheme continues after this the homeowner could potentially still claim any cash payment under the equivalent scheme.
In real world example of someone who has taken up the offer he has published the results on a discussion forum thread topic titled Free Solar Power System. Is It a Scam? The graph published shows the PV solar panel output from June 2010 till December 2010.
According to the graph peak output occurred August topping nearly 400kWh. Over the period measured just under 1800kWh were generated saving an estimated £90 on their electricity bill. If we extrapolate that over the whole year taking into account the lower sunshine levels in Winter and early Spring he probably would save about £150. Not bad when it doesn't cost anything to do.
Of course if you owned the panels yourself you could have claimed the feed in tariff payments at 41.3p per kWh. Taking the figure of 1800kWh that would add up to a tax free cash payment of nearly £750. Again if you take into account the other 6 months of the year this would easily top the thousand pounds figure.
With the bigger players getting involved in the market with the likes of the British Gas solar panel offer it shows that free solar panels are far from a scam. You should however take into account that if you paid to get solar PV panels installed yourself you could be claiming much more money back. Depending on the solar panel cost for installation over a 25 year period you could quite feasibly double your initial investment.
(22 July 2011)There have been some reports of door to door callers with solar offers in the Cornwall area. Claims are being made that local councils are offering grants to cover the cost of installing solar panels. Other claims being made are that you can cover the cost of your installation from selling back your surplus electricity.
There have been similar misleading claims which are completely false. It is concerning because people who do not understand how the solar grants work may be tricked into getting solar installed due to misleading information being given out. Before considering solar, either free or paid you should thoroughly research solar photovoltaics. You can find all the information here at Free Solar Panels UK and if you have a question you cannot find the answer to on the site you can always contact me and ask a question about solar.
If you are interested in solar PV you need to make sure that the company you are dealing with has the proper solar accreditation and that they have a history of installing solar. You can apply for free solar, you will be able to speak to a real person about your requirements for both free and paid solar installations.
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Grants & Schemes
Installing solar panels to produce electricity could earn you up to £1,200 a year. These payments are tax free, index-linked and guaranteed for 25 years.
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