Solar Power should ALWAYS be the last piece of the puzzle: The 3 things you must do before considering renewable energy in your home or business.

Solar Power should ALWAYS be the last piece of the puzzle: The 3 things you must do before considering renewable energy in your home or business.

Renewable energy is a big thing. The International Trade Administration (US) is quoted as saying that renewables are “one of the most vibrant, fast-changing, and transformative sectors of the global economy. Global clean energy investment, including renewable energy, totaled more than $329 billion in 2015”. That’s a lot of money, particularly for an industry that is really only in its adolescence, while smartphones, virtual reality, social media and the like seem to dominate the landscape. But the key thing to keep in mind is that big solar and residential battery storage systems have just emerged, and it’s just the start of the journey. There will be rapid growth for many years to come.

But let’s concentrate on your home or business. Why have you already gone down the renewable path, or might in the near future?

In 99 out of 100 cases, there are two very specific reasons why people invest in solar or other renewable energy technologies:

  1. To save money on ongoing and rising energy costs
  2. To understand the human effect on natural resources and because they want to be a part of a change

The only other reason we hear, very sporadically, is to add value to property, but this isn’t very well-supported in property investment circles: Normal ROI tends to break even.

I said that solar, the most common of renewables,  should be at the bottom of your list, but I also just raised some valid points about its importance in our lives and our future. So what the hell am I on about?

Solar energy is a fuel. It provides energy for a predetermined purpose. It’s a clean option for generating power for buildings, mobile devices, remote industry and, in time, viable and commercially available vehicles. But do you think large investments to create renewable systems to power inefficient applications is smart use of money?

History has shown us that technology in the automotive sector, with high-level advancements in functionality, performance and safety, has always preceded technology in residential, built environments. This is largely because new vehicles are designed by a team with a common goal, sometimes under one roof. Do you think that the R&D departments of Tesla and Mercedes-Benz, who are now developing commercially available solar vehicles, simply looked at available solar products and are exploring ways to fit them into their existing flagship vehicles? Of course not. These solar vehicles are being designed and engineered to be fit-for-purpose. First, they need to be highly efficient, reliable, aligned with the power source, and uncompromising on essentials such as safety and performance. Only once all of these boxes are ticked do they work out how big the battery system needs to be and how much solar power will be needed to keep those batteries charged. The renewable power is last on their list (fundamentally speaking of course – I’m sure the choice of leather is somewhat later…).

Consider the residential market. Granted, most homes are existing dwellings, which was true for 91% of all homes financed in the first quarter of 2016 (www.abs.com.au/ausstats). Prior to 2008, when nobody was really considering photovoltaic solar devices as a viable and affordable power source, how many of these homes were designed for renewable energy systems? Very few. But what’s far more disappointing is that even now the vast majority of new homes are still not designed and built with renewable energy in mind. So what does this mean? What is it to have a home designed for solar?

Remember, solar is a fuel. People confuse having an alternate energy source with being ‘energy efficient.’ Not true. Efficiency is getting the most out of what you’ve got. Subsidising an inefficient home with solar is much like paying for premium gas for a car with a leaking fuel tank.

So if solar is on the agenda for you, please consider a few important factors first:

  1. It’s cheaper to SAVE electricity than MAKE electricity. A 50+ sq. home that has not been optimised for efficiency will use on average between 60 kWh and 70 kWh per day. A 10 kW photovoltaic solar system in Melbourne will cover maybe 60% of that, and comes with a price tag of about $15,000. This scenario would leave an extra $2,500 in electricity bills each year. Alternatively, $7,000 could be spent on the same house for energy-saving devices (timers, sensors, efficient appliances/lighting, etc.), which would reduce energy usage by up to 50%, or 35 kWh per day. A 5kW system at about $7,000 would then cover 60% of remaining usage, leaving only an additional $1,000 in annual energy costs. Over a 10-year period, if installation cost and the cost of electricity are combined, the result is about a $22,000 saving, not even allowing for the steep rise in electricity costs year on year.
  2. It may compromise the integrity of your home (not to mention affecting insurance). There are a lot of solar installers out there now. Before 2010, getting accredited as a solar installer required over 600 hours of education and training. For most people, this meant two years of night school, two nights a week! Now any licensed electrician can get accredited in three days. Scary, right? Another issue is that photovoltaic solar systems are installed on roofs, and this comes with considerations such as wind ratings and weatherproofing. Regarding recently built or renovated homes, Kendrick Myers from Sydney-based roofing company MyCladders, says: “As soon as solar is installed on a Colorbond roof, both the product and installation warranties are voided, unless certified by a licenced and registered roofing plumber”. Repairing water damage from a leaking roof could cost many thousands of dollars, and I’m sure no one would be happy if the warranty or insurance was voided.
  1. Good technology can’t fix bad behaviour. Too many systems are installed with no monitoring systems, creating two major problems. Most homeowners are unaware of how, or if, their solar is actually working. You may look at the electricity bill for credits each quarter, but then again you may pay by direct debit and never check. If you and your kids could actually see the difference you are making from both a financial and environmental point of view, do you think this would make you more aware of leaving lights on or running heating/cooling devices for too long? It has been shown time after time that simple behavioural changes in a home can reduce energy usage by up to 30% without changing the way you live at all.

So stop and think next time you’re lamenting the size of your electricity bill or feeling guilty about your impact on the environment and then impulsively Googling the closest solar installer in your area and think your problems are solved. Find ways (or people) to help reduce your load first. Ensure that solar can be installed for your home and whether it is in fact the best renewable technology. Investigate some simple changes in your home to increase efficiency. This could give you results you thought were not possible and save you a ton of money.