Read this before buying solar: 5 charts that matter

When looking at investing in solar panels for your property, you’ll see hundreds of online calculators that take your details and give you opaque, often very rosy estimates on how much you can save — or earn — after buying.

The truth about how solar panels generate energy and how they perform depending on the season, direction and how you use this power tells a much more nuanced and interesting story.

This isn’t investment advice, so do you own research before splashing out on solar technology, simply to show some interesting things I found in my research.

The figures for this article are based on data taken from a weather monitoring station on the roof of the University of Applied Science in Berlin (http://wetter.htw-berlin.de/).

Figures about daylight will generally true for cities on similar latitudes: Manchester, London, Paris, Amsterdam, Calgary, Winnipeg. The amount of cloud cover will, however, be different and affect your throughput. For more information: http://brilliantmaps.com/cities-transposed-latitude/.

Direction panels face makes a difference

The direction that your roof faces will affect the amount of light it gets — that’s no surprise. But exactly how much? Facing your solar panel to the south with a 35° incline will result in 260kW (~28% of 934kW) more energy hitting the panels than a similar westerly installation.

Not only does direction matter, the angle of your panels is also important for maximizing output. Simply because the sun is higher in the sky closer to the poles during summer and lower during winter.

A typical installation uses a 35° angle, which I’ll use in this article.

More info:

Seasons: Summer generates more, but it’s not due to temperature

There’s almost 4 times more energy hitting the ground in summer than in winter. This is mainly due to longer days and the higher angle of the sun and little to do with temperature. Winter suffers the most with only having 1550 hours or sunshine and the sun only reaching between 15–30° (not so good for our typical 35° installation), compared with 2920 hours and 50–60° in summer.

Global irradiance at 35° facing south in Berlin by season

I’ve shown the disconnect between temperature and energy in the graph below, which shows average amount of energy received at noon per month vs the average temperature for that month.

A clear example are April and August, both at 550 W/m² at on average noon but there’s a 10°C difference between average temperature.

Temperature isn’t as important as the angle of the sun. The sun is at its highest angles during spring and summer. Therefore increasing irradiance. Click to enlarge.

More info:

Solar panels generate most power when you’re at work

When you’re at work, the sun is shining. In fact, if you’re out of the house between 8am and 6pm Monday to Friday, you’re only at home during 45% of the total daylight in a year. This increases the importance of being able to sell power to the grid.

The sun shines when you’re at work. The area in grey represents when you’re out of the house at work (8am-6pm). Click to enlarge.

How much can I expect to generate?

Generation depends on:

  1. Number of panels — The more panels you have, the more you can generate and the more efficiently you can convert from DC to AC.
  2. Efficiency — For retail installations this is generally 15 %
  3. Location, direction and angle — We’ve already discussed

Out of these three criteria, the one you have most control over are the number of panels you choose to install. You can’t do much to improve the underlying efficiency of your panels (apart from keeping them clean and unobscured by weeds or trees).

15% panel efficiency will give you 15% of the irradiance hitting your panel. So in Berlin, between May and August, a good hour will give you at least 600W/m² which translates into 90W/m² of generated power for you to use.

Then you need to take away losses in converting the power from DC to AC in your “inverter”. This is generally around 10%

Below is a table of the kW generated on average for each hour each month based on 18m² installation, which would represent a 3000 kWp (“kilowatt peak” as it’s often call in marketing brochures) installation. This installation would be facing south (the best direction) and on a 35° angle.

kW generated on an average hour per month for an 18m² installation. The more orange, the more power. Click to enlarge.

What does that mean in terms of money?

That’s a little more tricky. There are four things to consider in most countries:

  1. Price you pay for the electricity — What you pay and when you use it. Remember you’re out most of the productive hours if you work.
  2. Rate you can sell electricity back to the grid — This is often lower to take into account the cost of transmission, metering, etc.
  3. Taxes — In at least the UK and Germany, you can sell energy back tax-free for a number of years.
  4. Time — How these factors will change over time.

In Germany, the feed-in rate is currently (end of 2017) €0.11 per kW/h and generally consumers pay about 0.23€ per kW/h for power they use off the grid.

Below is an illustration of an average hour for each month using the feed-in rate for weekdays when you’re at work (8am-6pm) and the higher rate for when you’re at home. This of course assumes you use all power you generate at weekends and evenings.

Illustration of feed-in rate Germany, 18m² installation. Click to enlarge.

In the UK, the feed-in rate is currently £0.04 per kW/h and consumers pay about £0.14 per kW/h for power they use off the grid.

The assumptions are the same regarding weekdays and weekends as above.

Illustration of feed-in rate UK, 18m² installation. Click for to enlarge.

With the costs of a panel installation being around €3000-€4000 or around the same number of pounds, the payback period of a solar panel installation is likely to be 10 years or more.

Many solar panel manufacturers offer 25-year warranties on their products. The expected lifetime of a panel will therefore likely far exceed its payback period.

Panels however do degrade over time. The general rule of thumb is to consider 1% degradation each year, leaving round 80% after 20 years.

Final thoughts

  • You will probably get your money back on an investment in solar panels after about 10 years and you’ll need to replace the panels after 20 to 30 years.
  • The amount of revenue you’ll generate won’t be huge (perhaps a few hundred euros or pounds per year).
  • You become more dependent on the grid, not less. In order to pay off the initial investment from your panels, you need to sell energy back to the grid when you’re at work.
  • Batteries may help you use energy in the evening that was generated during daylight hours. The lifetime of batteries bought today is a big question so the payback period may be long or non-existent.

Sources

The data used in this article was generated from two sources:

Contact me for sources: my adapted sunrise and sunset Python script and Excel spreadsheet used to generate the diagrams in this post.

Disclaimer and request for feedback :)

Any views expressed here are my own.

I do not give any investment advice, simply information about solar panel technology.

As I am not a professional in this industry, there may be errors in calculations or statements I have made about solar technology. Please be aware that I am not liable for any damages or losses due to actions you take from the content of this article.

If you know more than I do about solar, find any errors or have any other comments, please let me know. I love feedback!

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