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Solar panel payback

The initial set up costs of installing solar panels can be quite intimidating, enough so to discourage many people from making the investment. However, with the help of a reliable company specialising in solar products and services at reasonable prices, you can make your money back in less than ten years, while substantially reducing your overall energy costs and your carbon footprint.

Solar power is an especially important alternative in South Africa, where the national electricity supplier Eskom has struggled for years to provide sufficient quality power to the population. This coupled with the fact that our climate is sunny and hot for most of the year means that South Africa is one of the world’s best suited locations for producing solar power.

It is quite difficult to accurately predict the exact payback of investing in solar panels, as it depends on variables such as the quality of the system installed, the amount of sunlight over a particular period of time, and the demands on the system.

In South Africa it typically costs between R10 000 and R25 000 to buy solar panels and set up a residential solar water heating system. Eskom will use part of the money made as a result of their much publicised tariff hikes to increase the subsidies for solar power systems from around R2500 to R7000. These improved incentives mean that almost half the cost of solar panels will be covered by Eskom for people who invest over the next couple of years. The National supplier has a total budget of R2 billion with which to subsidise solar power investment over the next five years.

The average monthly electricity bill for a South African household was calculated at R560 in 2008. With Eskoms’s increases this will rise to R1277 by 2011. For businesses which run on electric power and spend a whole lot more on electricity every month, the increases will be much more financially burdening. The high, and ever increasing, cost of conventional electricity in South Africa makes solar panels a worthwhile investment.

Home solar panels and water heating systems generally have a lifespan of 20 to 25 years. This can be extended by a couple more years if the system is kept in good condition and the pressure valves and vacuum breakers are regularly checked.

5 thoughts on “Solar panel payback”

  • Peter

    Hi Zeke

    Solar water heating only represents a savings (nonetheless) for approx. 40% of a households energy requirements. How are total solar systems (inverters, batteries, etc.) cost effective or is a combinatiion of gas for heating, etc. the way of the future??

    I am busy trying to make the difficult decision who to go with re starting off with solar water heating but which are good and bad suppleirs?? any help?


    • Zeke

      Hi Peter

      It begins with energy efficiency, saving energy is cheaper than generating it. In terms of an average home the costs involved to meet the load requirements are considerably less than what is required to be entirely off-grid. The grid connection can be considered as a back-up to the renewable energy system. In this instance then the capital outlay will be less as the battery bank can be 50% of the budget and of course is the most unreliable component.

    • Zeke


      For advice on the best Solar Water Heating Systems speak to Ian at Sustainable Projects, 021 701 2029

  • David The Solar Guy

    Wonderful piece of writing, thought it was interesting. I am putting your webblog to my own list of favorites, keep up the great posts bud!

  • Solar Panels

    Solar panels can be expensive to get, assemble, mount and start-up. Little saving tips can dramatically bring costs down. The only draw-back with solar panels is the initial process. But once up-and-running the ROI is unmatched. Also with the epidemic move to solar, we should see a drop in pricing for the obtaining of solar. The only problem is that, since solar increase the value of any property, then that means price might sky rocket again.

    A balance though should be struck once rules and regulations take place on a bigger scale. Eskom will have a lot to say on that one. The White House is also considering Solar Panels on its rooftops - AGAIN - with Obama as the instigator. This now makes everyone start seing the value of Solar. Beats me why people only pay attention to things only when someone of reputation says it ...

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