We are often asked what the payback period is for a solar system.
To find out we looked at 5 Newfield customers with similar systems – Newfield Flex with 6 solar panels, a 5kW inverter, a 5kWh hour Li ion battery and an efficient ceramic geyser element.
These systems do not feed back to the utility grid and use solar power to keep the battery charged – the battery is used for some night time consumption and during load shedding. The systems power all lights, most plug circuits and the energy efficient geysers.
The price of the systems as installed ranged from R100,000 to R119,000. The graph shows a typical solar production over a year for the sample systems with the average being 340kWh per month.
City of Cape Town residential electricity tariffs are as found in Table 1. below:
If we take the CoCT tariff and multiply it by the average production of 340kWh per month we find that:
- If the household uses less than 600kWh per month the solar production would account for R1050 per month.
- If the household uses more than 600kWh per month the production would equal about R1450 per month.
Using these figures we can determine that the payback period is between 6 to 9 years depending on the upfront cost and which CoCT tariff is applied.
If we calculate the payback period using the 2024 tariffs which are expected to increase by 11,71% the picture becomes even more favourable – between 5 – 7,5 years. The payback period will continue to decrease with each tariff increase.
The systems have the ability to feed back to the utility grid, which could increase savings and reduce the payback period even further. Historically this has required the installation of a smart meter at about R13000 which negates the savings. The CoCT has promised that a less expensive meter will be introduced soon, which will make this scenario worthwhile. Contact us to be alerted when the new meters become available.
To find out how to put your roof to work and keep the lights on for less contact us now!