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Earning Back Your Investment on Your Solar Panel

When calculating the benefits of having solar panels installed, you may want to compute how long it takes to finally earn back the amount you spent for the installation. This is not Return on investment or ROI but something more comprehensible for most households. You may want to have an overview of when you can really consider the power generated by your solar panels as real free power.

To simplify things further, consider this example. If you bought a golden-egg-laying hen for £100,000 and the hen, daily, lays golden eggs that can be sold for £5,000, you may not consider the first 20 eggs as your actual income since they are merely compensating for the £100,000 you shelled out. Also, you have to take into account the cost of feeding and caring for the hen.

That’s why it’s very important to choose the right solar power system to get. You have to pick the one with the least cost but without quality compromises. Your solar panel should be efficient to be able to generate a good amount of power that will lead to savings on your power bill. Be sure to do some research before you get your solar panel system. Try sites like  to help you find the best options.

In the UK, you can benefit from your solar panel installation not only through the power bill savings you get. You can also enjoy feed-in tariffs at around £400 annually if you have a 3kW panel. This feed-in tariff rate is tax-free and is applicable for 20 years. You can also possibly earn a national grid sell back rate at around £60 per year. This tariff is for the power you produce but you don’t use.

On average, a 3kW solar panel can yield power bill savings of around £100 per annum. Add this amount with the annual tariffs and you can expect to earn back the full amount you invested on a 3.5kW solar panel system in more than 10 years. This means that after 10 years, you will be enjoying completely free electricity from your solar power system and even earn some form of income. You can earn over £3,000 (in a year) by your 15th year and close to £7,000 by your 20th year of using your solar power system.

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