Photovoltaic Solar energy System cost vs Generator vs Eskom costs
A common question we get is “How long will it take to pay my Solar System back” or “How does a photovoltaic Solar energy System compare to the cost of a generator”. These questions are actually a bit more complex to answer than a simple quick reply, as many provisions are present, as well as much long term uncertainties, such as the annual Eskom price hike, Fuel prices going forward, Rand/Dollar or Rand/Euro currency exchange.
Further to that it would also vary per system- as I would attempt to explain in the dissertation to follow.Let us have a look at the different potential client scenarios, each with a different answer:
1. I live in town and get the occasional Load shedding’s 1 or 2 per week, what would be the most feasible option to look after my blackout periods?
2. I am tired of the load shedding; I want to completely go off the grid, either by means of a Generator or a solar system, what is the cheapest?
3. I live on a Farm with no Eskom, What is the best solution to operate my farm, a Generator or photovoltaic Solar energy System?
4. I am tired of the high electricity bills and want alternative means of energy source – Can I use a Generator at home/office or do a Full photovoltaic Solar system to replace my Grid supply and what are the options?
5. I want to connect only a GRID TIE solar system to my house/office No batteries no backup, purely Solar panels- How long would it take to recover my costs
Assumptions & Provisions contained into the calculations
In order to present some graphs and figures, and to try and compensate for future variables, I had to make certain assumptions.
* An Electricity tariff of around R1 per kW.h is used, prices vary between 77c/kWh and R1.40 per kWh, I took an average of R1.kW.h for current grid charges
* Rand deflation based on a conservative 8% per year
* Petrol & Diesel price increase of around 12% per year
* Eskom rates increase off around 14% per year
* Prime Rate of around 8% p.a,
* I took , solar system cost on average for different suppliers and not linked to a specific make, but I worked only on top quality products
* I allowed for annual service of Generators at the recommended generator operating hours and their service requirements
* I allowed an option for Battery replacement to take place on photovoltaic Solar energy systems, on an average of every 5-6 years- This is practical, but variable, as different type of batteries and system designs allow different options
* Business have the further advantage that product purchased can be capitalized , Depreciated and the interest on the loans as well as the annual depreciated can be written off against Tax. This means that SARS effectively assist in the purchase price of a solar system
* All these options are allowed for as variable inputs.
Please click here to do the calculations
Disclaimer
This webpage and the information presented is to my knowledge correct, however we give it here only as advice and general information as a guide we accept no responsibility for the use, misuse and representation of same to other parties and applications without my written consent and agreement.