Investing in solar PV can provide a better financial return than a traditional pension, according to energy and climate change minister, Greg Barker.
In an interview with the Daily Telegraph, Barker described solar PV as a “really attractive financial proposition”, and urged the public to consider investing in their own solar array.
Barker said: “Solar is a really attractive financial proposition. You get a guaranteed tariff for 20 years and if your panel is well-sited, it could yield 8% or more. That is more than an annuity, particularly if you are in your 50s or early 60s.
“Anyone considering retiring should seriously consider whether solar panels are right for them, because in some circumstances, they will get a higher return than from putting the money into an annuity.”
Barker made the comments after visiting a couple in Sussex who installed solar to mark the completion of half a million roofs in the UK with solar arrays.
Worried you missed your chance in 2011? Thanks to our reforms, hard work by industry & crashing prices, my message v simple #Solar is back!— Greg Barker (@GregBarkerMP) February 4, 2014
However, Stow-based solar installer, Freewatt, believes that the minister may have undersold solar’s financial performance. The company believes that the typical return on investment for owners of domestic solar arrays is actually around 10%.
Freewatt notes that the decline of annuities over recent years has resulted in an underwhelming typical 6% return. In contrast, homes with solar installed can expect a three-fold financial return – generating electricity savings, receiving the feed-in tariff revenue and selling any surplus electricity back to the National Grid.
The company’s CEO Julian Patrick said the minister’s message reinforced what the company had been pushing for years, he said: “People in the UK tend to have a cynical view of life and think that if an investment looks good and risk free then there must be a catch.
“But an investment in domestic solar power really is as sensible as it looks. The money needed is within reach of lots of families, costing less than a car in most cases, and provides them with a 20-year income.”
The minister’s backing of solar will come as a welcome boost to the domestic solar sector which, despite steady growth, has failed to hit the 15-20MW a week the industry predicts is necessary to meet Barker’s 20GW by 2020 ambition.
Leonie Greene, head of external affairs at the Solar Trade Association concluded: “It’s great to hear ministers publicly championing investment in solar. This is just the sort of advocacy the industry needs to get the market going. Returns are great and the technology is set to carry on dropping in price and delivering a real alternative to dependence on Big 6 energy bills. We’d love to hear more from politicians about how solar can seriously empower consumers. The more people invest, the faster prices come down. This needs to be a national effort.”