James Elston
Published June 12, 2024
Yes, you may still be required to pay for electricity if you have solar panels. However, you would not have to pay for electricity if your panel system is completely off-grid.
Unfortunately, off-grid systems are not attainable for everyone. The majority of UK residents and business owners cannot afford to install solar panels to the point where they are completely off the grid.
Despite relying on the national grid, solar panels still lower your energy bills significantly. The energy collected and generated by your solar system can be used for many appliances, such as boilers, central heating systems, lighting and plug-in devices.
In this article, we will discuss the impact of solar power on your electricity bill and compare utility expenses with and without solar panels.
Contents
How Do Solar Panels Affect Your Electricity Bills?
A solar panel installation can result in a notable reduction in your electricity bill.
If you want an in-depth record of your electricity usage with solar panels, consider investing in a solar monitoring system. These systems outline how much energy is provided by your energy supplier and how much your solar power is utilised.
What would my electricity bill look like with solar panels?
According to Energy Saving Trust data, annual savings on household utilities for various regions would be:
- South East England: £150 – £360
- Wales: £145 – £350
- Northern England: £140 – £345
- Scotland: £135 – £335
These averages are based on how long a person spends at home during the day, ranging from home all day to out all day until 18h00. The costs shown here are without the Smart Export Guarantee (SEG).
With the SEG tariff applied, the savings would be considerably higher:
- South East England: £520 – £630
- Wales: £475 – £580
- Northern England: £460 – £565
- Scotland: £420 – £525
Your savings will further be influenced by the number of solar panels you have installed, the size of the solar system, and the size of the household. Larger systems can provide more electricity which lessens your use of grid power. For example:
| Solar Panel System Size | Number Of Bedrooms | Number Of Panels (450W) | Annual System Output | Annual Savings | Annual Savings With SEG |
|---|---|---|---|---|---|
| 2 kW – 3 kW | 1-2 | 6 | 2,550 kWh | £440 | £480 |
| 4 kW – 5 kW | 2-3 | 8-10 | 3,400 kWh – 4,250 kWh | £660 | £700 – £745 |
| 6 kW | 4-5 | 13 | 5,100 kWh | £1,005 | £1,060 |
What is the Smart Export Guarantee?
The Smart Export Guarantee (SEG) allows homeowners to sell excess electricity back to the grid. Homeowners can earn money on this surplus energy, which is paid out per unit sold to the grid. Below is an example of what you could expect to get from different suppliers for your excess solar energy.
| Supplier and tariff | Amount per kWh |
|---|---|
| British Gas (Export and Earn Plus) | 15p |
| E Gas and Electricity (ESEG January 2020.v.1) | 1p |
| E.ON (Net export Exclusive) | 16.5p |
| Good Energy (Solar Savings Exclusive) | 20p |
| Octopus Energy (Intelligent Octopus Flux) | 35p |
| OVO (OVO SEG Tariff) | 20p |
What Are The Different Types Of Solar PV Systems?
There are three types of solar panel systems: grid-tied, hybrid and off-grid. Each has its merits as well as drawbacks. The system you opt for could also play a significant role in how you use your solar panels and your monthly electricity bills.
Grid-tied solar system
A grid-tied or on-grid solar panel system is the most commonly used system in the UK, both domestically and commercially. With this system, you remain connected to the national grid, but can still reduce energy bills and lower your carbon footprint. This system allows users to make use of their free solar electricity during daylight hours.
If your solar panels generate any excess electricity, it goes back into the national grid which acts as a shared pool. You are then paid for this if you are signed up for the SEG tariff.
Once there is no longer sunlight to supply solar electricity, you can rely on the national grid supply. However, if the national grid fails, you won’t have any power at all.
Hybrid solar system
Hybrid solar systems are grid-tied systems with the added security of solar batteries. These battery storage systems allow you to use stored solar energy even after sunlight hours.
Once you have used up the electricity from your battery, you can revert to drawing power from the grid, making this system a more flexible alternative.
The one stand-out advantage of a hybrid solar system is that the energy stored in the solar batteries can be used even if the national grid is down.
The main disadvantage is that these systems are generally more expensive than grid-tied ones. On average, solar batteries cost between £1,500 and £7,000.
Off-grid solar system
This system operates without any tie to the national grid. It is an ideal option for those in remote areas, areas prone to blackouts and those who want to be completely self-sufficient.
The most appealing feature of an off-grid solar system is that you will have no electricity bill. However, the upfront costs of installing solar panels and battery storage to fully maintain your energy requirements are quite high.Â
A system of this kind can cost between £15,000 and £28,000, excluding solar batteries, generation meters and optional generators.
FAQs
Why have my solar panels made no difference to my electricity bills?
If you have installed solar panels but see no difference in your energy bills, you might want to call in an expert to assess the efficiency of the panels. If no faults are found, your panels may not be optimised.
You can add a few more panels, ensure they are south-facing, and limit shading over the roof. If your electricity bill still remains unchanged, your household consumption may be the cause.
What is the average payback period for solar panels in the UK?
Your full solar panel ROI could be achieved between 6 and 10 years. If you take advantage of energy-saving incentives and make use of other renewable energy sources, this time frame could be even less.
Likewise, the cost of your solar panels and your energy consumption could also extend the payback period.
What is the lifespan of a solar panel system?
Solar panels have an average lifespan of 25 years. Other components of this system have shorter lifespans. Inverters may require replacing after 12 years and solar batteries last between 5 and 15 years.
The lifespan of your solar panels can be improved with annual maintenance and general upkeep.
Conclusion
For most solar panel installations, you will still need to pay for some electricity from the national grid. However, as long as your solar panels work, are efficient and can maintain your energy consumption, you should still see a noticeable difference in your utility bills.
While the renewable energy supplied by your solar panel system may not be enough to live independently of the national grid, it can power most of your household or business.
Your next step towards paying less for electricity would be a hybrid solar system. A solar battery allows you to use free electricity at night, meaning further reduced energy bills. For more information on solar panels, installations, and solar batteries, contact Eco Happy. Our expert team provides sound advice on energy-efficient and cost-saving measures for your solar panels.
James Elston
Boiler Expert
James Elston is the top boiler replacement and heating expert at Eco Happy. He has over 20 years of experience in the industry, focusing on Gas Safe boiler installations and offering home-heating and energy-saving solutions to homeowners across the UK. From sourcing the most energy-efficient combi boiler to providing specialist heating advice, James ensures that Eco Happy maintains the highest standards and best customer service.