Solar energy for home and community

What we aim to cover

This meeting is about Solar Electricity (also known as photovoltaics or PV) with two main topics:

• Things you should know if considering putting PV panels on your own roof.

• The idea of a Solar Co-op which could enable people to share ownership of a PV system on (for example) a school roof and get a good return on their investment.

What is involved

Is your roof suitable?

• Ideally it faces due south (between south west and south east worth considering)

• Ideally the pitch (slope) of the roof is 300- 400

(200 - 500 might be OK)

• The roof needs to be free of shading by buildings, trees etc.

Orientation and Pitch

Planning Permission

• A PV system for a house will not in general need planning permission

• In a conservation area planning permission may be needed – check with planning authority

• On a listed building planning permission will be needed and may not be given

• For these last 2 cases PV tiles which look like slates might be acceptable

What maintenance is needed

Almost none

• The panels should last at least 30 years

– and may last 50 years or more

• Output from the panels gradually falls over time but should be still at least 80% of original output after 25 years

• The inverter is likely to need replacement after maybe 15 years

What it might cost

For a house - roughly £8,000 to £14,000

depending on:

• Size of system

• Type of panels used

• Scaffolding needed

• How competitive a quote you get

Money you can make back from free electricity

• A 3kWp system can generate about 2,700 kWh (units of electricity) per year

• Each unit could be used in the house or exported

• Electricity that you use from the PV system saves you having to buy it from the grid

• You will still buy from the grid when you want to use more than the panels are producing (most obviously, when it is dark)

• Electricity prices are likely to go on rising

Money you can make from Feed in Tariff (FIT) payments

43.3p for every kWh generated *

• whether you use the electricity yourself or export it to the grid

• Payable for 25 years from installation date

• Index linked, so will rise with inflation

• Income tax free

* for systems installed up to April 2012

What money you can make from selling electricity to the grid

• At times when the panels are making more electricity than is being used in the house the surplus is exported to the grid

• For each kWh exported you get 43.3p FIT

+ 3.1p for exporting

Although output from panels is metered,

mostly exports are not metered, but “deemed” to be half of all that is generated.

Finance summary – example system

• 3 kWp system

• Installation £11,000

• 2,725 kWh/year (maybe half your electricity)

• £1,180 FIT + £41 export = £1,221/year

• 9.01 years payback time

• Total received over 25 years = £20,521

(ignoring saving on electricity and index-link)

• ROI/year 7.10%

Issues with insurance

• Some house insurers have not come to terms with PV installations and will be a problem

• Others are perfectly happy with them

You will need to check

Selling your house

• It is too early to know what PV panels will do to house prices

• The new house owner gets long term benefits

• How much extra will they be prepared to pay?

Picking an installer and what panels to install

• To get the FIT your installer and the panels used must be MCS registered.

• MCS is the Government MicrogenerationCertification Scheme

• This is a minimum standard

• Panels vary in quality of build, efficiency and price

• As with any building work get quotes

It may not make sense or even be possible for you

• Don’t own a roof

• Roof faces East and West

• Roof is shaded by other buildings

• Expect to move in the next few years and might not recoup the investment

• Have not got £10,000 to spare

Free systems

• There are companies who will install a PV system at little or no cost to the roof owner

• The roof owner gets electricity in return for leasing the use of their roof for 25 years

• The installer gets the FIT

• Too early to know what this will do to house sales

• The new house owner would get electricity but would have to accept the lease

Examples of working Wind Energy Co-ops

• Baywind

- was set up in 1996 based on similar long established examples in Denmark and Sweden.

- Over 1,300 members and more than 2.5 MW of wind turbines funded by community shares.

• Energy4all

- a spin-off from Baywind, has helped set up 7 more community wind power co-operatives in England and Scotland

Examples of working Solar Energy Co-ops

• Ovesco (Lewes, Sussex)98 kWp system running, funded by £300,000 share issue.

• Green Energy Nayland (Suffolk)15.5 kWp system on running on a Village School

• Bath Community Energy50 kWp + 28 kWp systems waiting for planning permission

• BrightonEnergy.org.uk50 kWp system has planning permission, 35 kWp and 10 kWp systems being planned

• Community Energy WarwickshirePlanning systems on Stratford and Warwick hospitals

• Thesolar.coop (Berkshire)Planning £1M share issue for multiple 50 kWp and 10 kWp systems

What a Solar Co-op could mean for Penarth

• The Co-op leases roof space for 25 years

• The Co-op pays for PV installation

• The Co-op collects the FIT to pay back its investment plus a reasonable return

• The building gets free electricity

• If the building is council owned (like a school)

council tax is freed up to be spent on services

Legal structure

• Energy Co-ops are in general legally Industrial and Provident Society Co-operatives

• They have one member one vote

(not one share one vote)

• Their only shareholders are their members

• They are run day-to-day by a management group which reports back to the membership

Community shares issuesand dividend payments

• Energy Co-ops can raise money from their members with community share issues

• The shares have a fixed value and are not tradable • Shares can be sold only back to the Co-op• An annual dividend is paid on each share• No returns are guaranteed

(even the money invested) but…• On current projections a 4% dividend is reasonable• Investment of at least £500 kept in for at least 3 years

should allow 30% of the invested amount to be taken off your income tax liability.

Choice of roof

• A larger installation gives economies of scale

(a single 40 kWp system will cost less than 10 systems of 4kWp each)

• A large flat roof can have PV panels mounted on frames, facing due south and angled at 300

• On community buildings the free electricity would be benefit the community

How larger scale systems compare with smaller ones

The rate of FIT changes with size of installation

• Up to 4kWp (retrofit) 43.3p/kWp

• 4kWp - 10kWp 37.8p/kWp

• 10 kWp – 50 kWp 32.9p/kWp

• 50kWp – 150kWp 19.0p/kWp

Where we are now

• Talking with Vale of Glamorgan council and Cardiff and Vale University Health Board about potential sites

• Firming-up our plans

• Collecting email addresses of potential members

• Registering Co-op (within 2 weeks?)

What next

• Accept Co-op members (start in 3 weeks time?)

• Agree a site (by Christmas?)

• Select installer (by Christmas?)

• Get planning permission (January?)

• Get lease signed (January?)

• Community share issue (February?)

• Install system (by April 2012?)

• Collect FIT (and start working on the next site?)

Questions and discussion….