Solar Power in Australia: Does It Work?

As you probably will remember, one of our previous prime ministers, Julia Gillard, introduced the carbon tax in Australia despite promising “There will be no carbon tax under the government I lead.

On Thursday of last week, our current Prime Minister (as at the time of writing), Tony Abbott, fulfilled one of his election promises by abolishing the carbon tax in Australia. This is a promise not many people thought he would be able to keep, but he has.

Bill Shorten, leader of the opposition, condemned the government for making Australia “the first country in the world to reverse action on climate change“. Personally I think it’s something Australia should be proud of and I hope other countries follow suit. Whatever you think of climate change, slapping a tax on energy just makes everything more expensive for us, the people who pay enough taxes already.

The carbon tax is never going to save the planet.

Tony Abbott thinks that the average family’s electricity bill will now be reduced by around $550 per year, many people doubt that, but here’s something that could reduce your electricity bill here in Australia by far more.

Solar power

west facing solar

north facing solarYes, those are my solar panels, seven west facing and nine north facing; I had them fitted almost 2 years ago. They don’t do much in the dark, but let’s find out how they have performed in the sunshine.

I gave a full breakdown of what I was told to expect in my post Solar Power: Cutting the Cost of Electricity. Now that I’ve had a long enough period of time to test the system, I can answer the question…

Does solar power work in Australia?

If you are thinking of going solar, there are a couple of things to look at.

First of all, you’ll need to compare prices and find a reputable installer; you can use a company like Australian Solar Quotes for that. Secondly, you need to remember that each state has different rebates, feed in tariffs or whatever they call it, and that will affect how much money you will save.

All I think I can do is compare what I was promised by the solar power company prior to installation with what the solar power has produced since.

Here’s a brief summary of the figures prior to installation:

My electricity bills are hefty; between $700 and $800 per quarter. Just to put that into perspective though, my house has no gas, so it’s all electric. It’s four bedroomed, plus a study, larger than average. It also has a swimming pool which probably adds around $600-$700 a year to the bill.

On the plus side though, I also have a solar powered hot water system on the roof, which runs independently and takes care all my hot water needs.

With my 5 kW solar panel system:

  • 5.75kwH solar usage @ .23c (Inc GST) = $1.32
  • 14.53kwH solar export @.52c = $7.55
  • Daily saving = $8.87
  • Yearly = $3237.55
  • System cost $11,795
  • ROI 3.64 years

Again, full explanation of these figures can be found on my original post Solar Power: Cutting the Cost of Electricity. The only important thing to remember, I think, is that the return on my investment was calculated to be 3.64 years.

It is also worth noting that at the time the expectation was that solar power would cover my full yearly electricity costs and that “I might even get a small rebate.”

The performance over the last two years

Just to make it clear, the following figures are the bottom line on my quarterly electricity bills; I either owed them money (payment due) or they owed me money (credit).

Last year:

  • Spring: $269.28 credit
  • Summer: $359.15 credit
  • Autumn: $181.89 credit
  • Winter: $131.50 payment due

This year:

  • Spring: $254.02 credit
  • Summer: $383.20 credit
  • Autumn: $215.78 credit
  • Winter: $60.20 payment due

Return on Investment (ROI)

Total electricity bill over the last two years: $1471.62 credit or $735.81 credit per year.

My actual electricity bills for the entire year prior to the installation of solar power were $2969.54.

So instead of paying $2969.54 per year for electric, I am receiving $735.81 for electricity I have sold back to the grid. My full savings per year then are $3705.35.

Remember, I paid $11,795 for my solar power, I divide that by my annual savings then my:

  • New probable ROI is 3.18 years

Significantly better than I was promised.

Conclusion

Solar power does work, certainly mine here in Brisbane; maybe Queensland is not called the Sunshine State for no good reason.

Solar power is certainly worth investigating wherever you are in Australia, but bear in mind all tariffs are different. You certainly won’t get the feed in tariff that I signed up for, but on the plus side, you will pay nowhere near the amount of money I paid for my system, prices have fallen considerably.

All I can say, based on my experience, is that the figures and performance I was quoted by the salesperson have been exceeded, and it’s not often that happens.

Have you had it installed? How did it work out for you? Let me know in the comments below.

Sun

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{ 10 comments… add one }
  • Mahdi August 12, 2014, 11:35 pm | Link

    Very practical and useful Bob,thank you.

  • Catprog August 2, 2014, 2:34 pm | Link

    What would happen if you use that tax to reduce other taxes so the net monetary impact was zero.

    Wouldn’t the heavy carbon products cost more and encourage people to use low carbon products?

    • BobinOz August 4, 2014, 12:16 am | Link

      Not sure I fully understand your question, but the idea of encouraging people to use low carbon products just doesn’t work for me, almost everything requires energy to produce it and therefore there aren’t too many things that cost money which are low carbon products.

      • catprog August 4, 2014, 7:21 am | Link

        I meant low relative to alternatives.

        For instance

        Product A takes 10 tons and costs $1
        Product B takes 1 ton and costs $10.

        with a carbon price of $1/ton

        Both now cost $11. Presuming a 50:50 mix and everyone purchases 1. everyone will get $5 of their income tax.

        • BobinOz August 4, 2014, 7:32 pm | Link

          Ah, I get you, but there are a few problems; it’s probably too tricky to administer, there’s nothing in it for the government in terms of extra revenue and finally, no incentive in your example to buy the low carbon product if everybody gets $5 back of their income tax.

          And it still won’t save the planet 🙂

          • Catprog August 4, 2014, 9:02 pm | Link

            1) The tax is predicted to raise x dollars per person, therefore x dollars must go to everyone. Simple solution

            2) $11 for both means that it is not more expensive either for going the low carbon route.

            Another example
            $15 ($5 + $10 carbon tax) vs $14 ($13 and $1 carbon tax) . Someone who says their green but uses 15 of the green product will pay more of the carbon tax then someone who just buys 1 of the not green product.

            3)Of course not. The planet will be fine even if we continue as business as usual. It may not be very nice for humans to live on though.

            • BobinOz August 5, 2014, 6:35 pm | Link

              Personally I think it’s better that the carbon tax doesn’t exist in any form whatsoever, why would we want another tax? But maybe you might like to run your ideas past Joe Hockey, but you’d better build in something for the government before you do that 🙂

            • Lee Chan August 13, 2014, 3:35 am | Link

              I concur, it still won’t ‘save’ the planet. A couple of scientists already figured out how to transfer carbon out into space by more than one method to alleviate ‘man made’ climate change.

              • BobinOz August 13, 2014, 8:17 pm | Link

                Brilliant! Send it to outer space 🙂

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