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Solar Thermal - Costs and Benefits

Solar panels

A solar thermal system provides a great alternative to, or can compliment, a Solar PV system. The collectors are substantially smaller and cheaper than an equivalent Solar Photovoltaic array or other alternative micro-generation technologies, and it is low maintenance.

As with most retrofit energy generation equipment the cost of the system can vary on a number of elements. Principally the overriding factor is the quantity of people the hot water must comfortably provide for, and the resulting quantity of collectors required. The complexity of the plumbing and the suitability of your existing hot water system also have an effect on the final price.

Customers can receive £300 towards the cost of the system with the Renewable Heat Premium Payment and further funding could become available through the Renewable Heat Initiative. See Later

It is possible for Solar Thermal water heating systems to achieve significant savings on your energy bills, especially if your hot water is heated by electricity. A well positioned and properly sized collector would expect to save you:

80-90% of your hot water in the summer
40-50% of your hot water in the spring and autumn
10-15% of your hot water in the winter

In reality the actual savings you make on your energy bill will depend on how you use your hot water, unlike Solar PV which cannot store its energy overnight, a solar thermal system has use of a hot water tank. However, hot water tanks are finite so a consumer who uses most of their hot water during daylight “generating” hours will maximise the benefits of the system.

Self-finance calculation

Renewable Heat Premium Payment (RHPP)

The second phase of a two phase approach to support installation renewable heating technologies. The Renewable Heat Premium Payment scheme has now been extended for further applications. Providing around £12m of available payments to households in Scotland, England and Wales who install appropriate-sized systems after 21st July 2011. An Air to Water Heat pump system can attract a voucher value of £600 and does not effect on your eligibility for the Renewable Heating Initiative, although it is expected that the value of the RHPP contribution will be incrementally deducted from future RHI payments

Self-finance calculation

Renewable Heat Incentive (RHI)

The RHI is now available for the Commercial Installations. To date, the Government is yet to have published the full details of how the Renewable Heat Incentive will work in the domestic sector but it is due to be launched in the spring of 2014. Payments will be made on a quarterly basis for seven years. The tariffs for solar thermal have been set at 19.2p per kWh, however further consultation is in progress to establish if this rate would benefit from an increase. The RHI reflects the expected cost of renewable heat generation over 20 years. Payments will be made based on estimated heat demand of the property.

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