Solar sense

By Brendan Manning

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With rising power bills and winter fast approaching, now may be the right time to consider harnessing solar energy to reduce your household energy costs. But what do solar panels cost to install, how much will they save you, and how reliable are they?

Going solar


The price of solar has fallen dramatically in recent years and is now less than a third of the cost it was in 2008, according to Solar power provider PowerSmart.

The renewable energy source is non-polluting, free and abundant, the Energy Efficiency and Conservation Authority (EECA) says.

"New Zealand has good solar radiation levels in many locations. Radiation levels in Invercargill are roughly as high as in Germany, where solar panels are commonly used. Many New Zealand homes are exposed annually to 20 to 30 times more energy from the sun than they use in electricity or gas, yet this energy source is vastly underdeveloped."

Currently, only 0.1 per cent of the country's electricity is made up of solar power.

How it works


Solar electricity generation - also known as photovoltaics - works by converting sunlight into electricity through an energy conversion process, says the EECA. As well as providing domestic electricity production, solar energy powers weather stations, some road signs and parking meters.

The sun's thermal energy can also be harnessed for solar water heating - which uses the sun's rays to heat water stored on the roof, without the use of solar panels - which is then stored in an insulated hot water tank.

About 1.6 per cent of NZ homeowners have installed solar water heating systems, and around 3400 new systems are installed each year. The number of homes with solar water heating systems grows by 30 to 40 per cent annually, says the EECA. Systems typically cost between $3000 and $6000 and provide up to 75 per cent of annual water needs, with savings of at least $450 to $700 a year, according to Solar Electric Technology.

How much does it cost?


The cost of a solar power installation depends heavily on the site and equipment needed, but typically ranges from $9000 to $12,000. Solar Association of NZ chief executive Adrian Kerr says the actual price depends on the supplier and the size and complexity of the job. "Off-the-grid" systems, which run independently of the national grid, are considerably more expensive as they require batteries to store power for nights and bad weather days.

However, the cost of solar power systems is expected to fall as production expands and technologies improve. At the same time, the price of grid electricity is expected to rise, so solar power's cost-effectiveness should continue to improve, the EECA says.

The declining cost of solar panels has allowed small systems to pay for themselves within five years and provide an after-tax return on investment of 7.7 per cent - equivalent to earning 11 per cent from a bank.

A study by the Sustainable Electricity Association of NZ last year found that installing a solar power system resulted in cheaper power bills in all regions for those customers who remained connected to the national grid.

What can I save?


Kerr says going solar can save the average household up to and over $1000 to $1200 annually in energy costs. "[But] it's not just a matter of banging panels on roofs and expecting to get large savings," he warns.

For solar panels to be effective they need to be coupled with an energy management system so that high energy - such as water cylinder heating - is shifted from night to day when the panels produce electricity.

Meanwhile, savvy solar users "export" surplus solar energy generated during the day to the national grid, then import it back at night.

Although, warns Kerr, "You don't get paid as much for energy that you export as what you pay for energy that you buy back."

- Hamilton News

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