Lifehacker 101: Solar Power And Your Home

There are numerous benefits to making your home solar powered -- and more than a few pitfalls. Here's what you need to know about solar powering your home in Australia.

Image: Oregon Department Of Transportation

What Do I Need For Solar Power?

The very basics of a solar power system rely on just a few key components.

  • The Sun. Unlikely to go out for a few million more years, but it's worthwhile considering the positioning of your home relative to the big ol' ball of nuclear fire, because it can and will affect how much power you can generate.
  • Solar Panels. If you're looking for a whole of home solution, you'll need more than one, but for a small property only looking to handle hot water duties, you may be able to get by with just one or two panels using a solar thermal solution.
  • An Inverter. This converts the DC power produced by your solar panels into the AC current used by devices in your home.
  • A bidirectional electricity meter -- if you're going to feed power back into the grid, you'll need to be able to quantify it, which means in almost every instance, you'll need a new electricity meter to go with it.
  • Batteries for power storage -- this is an optional step, unless you plan to go fully off-grid or minimise your need for grid power in the medium term

How does it all work?

The solar cells in a typical system collect energy using the photovoltaic effect, which is why you'll sometimes see solar systems referred to as "PV" systems.

During the day, the sunlight is collected through the panels, converted via the inverter into AC current for whatever electrical need you might have and also fed outwards to the wider electricity grid if you're on-grid, or stored in batteries if you've opted to go entirely off-grid.

What Does On-Grid/Off-Grid Mean?

If you're connected to your electricity supply via a cable that runs from a pole, or underground, you're on the Australian electricity grid, and thus on-grid.

The advantages for solar systems in an on-grid setup is that your power generation can be fed back into the grid. Instead of generating power for you to use, you generate an income based on the feed in tariff paid in your state by your provider. The advantage for an off-grid system is that by using storage batteries, you save all the power generated by your system during the day, so that once the sun has gone to bed at night, you've still got power to use when it's dark.

Off-grid arguably makes the most sense for genuinely remote areas, however, as the cost of batteries does add considerable load to a solar system if you're setting up from scratch. This is an area where costs are improving -- Tesla's Powerwall systems are being touted as challenging the existing price of storage batteries, although it remains to be seen how genuinely economical they may be -- but it's undeniable that adding batteries and the necessary infrastructure around them can significantly increase the cost of setting up a new solar system.

Can I turn a profit on my solar setup?

The lure of feed-in tariffs can tempt many towards solar systems, figuring they'll never pay a power bill again, and instead start raking in cold, hard cash from their power company.

The reality is, as it so inconveniently is, rather more complicated than that.

At one point in time, many solar systems benefited from being paid a gross tariff for the power they generated, at reasonably high rates, which meant that whether you were using power or feeding it back into the grid, you got paid by the power company for that production.

That's no longer the case except in the Northern Territory, which means that you only get paid for net feed into the grid -- that's the amount you feed in less the amount you're using -- at relatively low rates, typically under 10c per kWh.

You've got to balance that rate against the likely production of a solar system and costs of installation and any maintenance issues. At a practical level, at current price structures, it's unlikely that a new solar system would pay for itself simply from net feed tariffs in most states.

Which isn't to say that a solar system is simply a green dream that can never pay off, because the other side of the equation lies in reducing your power bills. You might only be getting 10c per kWh from your provider for the power you feed in, but if you're reducing your draw from the grid substantially, where your per-kWh prices will be quite a bit higher, you're saving money -- and in essence, paying for your solar system as long as it's running for a sufficient number of years.

One huge caveat here is ensuring that your electricity provider in your state provides any kind of feed-in tariff at all. Not all do, and the rates that they pay vary quite considerably. This is an area where it pays to do your research and, where feasible, switch providers to maximise your solar investment.

How much solar capacity do I need?

This is one of those "how long is a piece of string" questions, because it's complicated by not only your total overall power usage -- which you should be able to find from any power bill -- but also when you're actually using that power.

Why does that matter? Unless you're going entirely off-grid, the best savings for an all-solar system are made when you're using the power yourself and saving that margin on the power usage versus taking it from the grid, rather than feeding it directly to the grid and getting the meagre feed-in rate.

Bear in mind that the sun only shines during daytime, which depending on the season and your exact location could be anywhere from 6am to 9pm, but is probably better averaged out to around 7-6 daily, with your peak production around midday under direct sunlight.

If your power draw is considerable during the day, you'll make much larger savings on that power usage than if you're out of your home during the day and using most of your power at night, where you'd be likely slugged with full power grid prices. This can be mitigated with a hybrid on-grid and battery system to an extent, but again you've got to weigh the infrastructure costs against the likely return.

Positioning of your solar system will affect overall efficiency of the system, but so will the size of the system that you're able to install on your property. This isn't always a direct linear effect of the size of the system, as some panels and systems can be more efficient than others.

Should I just buy the cheapest solar system?

Probably not. Again, this can be complex to state as an absolute, but it's clear that the Australian solar industry has had more than its fair share of dodgy traders and installers making wild claims, claiming rebates on behalf of customers in an unfair manner and installing sub-standard panels with limited lifespans.

As such, given the general cost of installing a solar system, it's wise to get as many quotes as feasible, and ensure that you're happy with the professional standard of an installer and the goods they're selling to you. Australian consumer law will cover you in any case, but that's not going to be much use if your installer closes up shop or you find that a system with a ten year "warranty" only has a two year warranty on the inverter or panels.

How do rebates work?

At the federal level, rebates are available for solar systems for the creation of renewable energy certificates (RECs). At the home level, what you're doing is creating a Small-scale Technology Certificate (STC) -- this is, in essence, your home solar system, for which you receive a rebate on installation costs. However, this isn't a cash-in-hand payment to you, but instead applied as a general discount to the cost of installing the system.

It was also possible to get financial investment help with solar systems through the Clean Energy Finance corporation, but recent moves by the Abbott Government has blocked that particular financial avenue for installations under 100kW. This has been widely condemned by the solar industry, to the surprise of absolutely nobody; the current government genuinely doesn't seem that interested in solar or wind power options at this point in time.

Can I install it myself?

Technically you can install parts of a solar system yourself, but in most cases it's not going to be your best move on both safety -- because electricity isn't a casual thing to muck around with unless you're properly trained -- and financial grounds. If you want the rebates on a panel, they have to be installed by a properly CEC accredited electrician, and not self-installed.

Equally, there's a number of electrical regulations that apply to hooking up any kind of device to the power grid. If you happen to be an electrician with the necessary training and certification, go for it, but for everyone else, it is a job best left to the professionals.

This all seems very complex

That's because it is. While absolute prices for solar systems have come down considerably over recent years, the decisions around the installation of solar systems rely on a number of variables. Some of them can be calculated, while others may end up being best guess estimates to provide a general picture of your power usage and needs. As such, this is intended to be a broad outline only. It absolutely will pay dividends to do your proper research before signing on any dotted lines. Ensure you're happy with your installer, their choice of brands when it comes to every part of your solar system -- not just the panels, but also the inverter and its features, wiring and switching boxes and so on -- and the rates you'll get for feeding into the system or costs for installation of batteries if you go down the hybrid or off-grid pathways.

Lifehacker 101 is a regular feature covering fundamental techniques that Lifehacker constantly refers to, explaining them step-by-step. Hey, we were all newbies once, right?


Comments

    At a practical level, at current price structures, it’s unlikely that a new solar system would pay for itself simply from net feed tariffs in most states.

    This is the critical point. It's not economically feasible at the moment without advances in cheaper battery storage.

      That's slightly out of context, though -- as I go on to point out, it can be entirely economically *feasible* if you budget, price and build with the context of reducing existing power bills via usage as your primary goal, with feed tariffs as a secondary consideration.

        Thanks Alex. Good point. You're correct.

        If you can use the power during daylight hours, then the reductions in your power bills will serve as good pay back. But if you don't use your power during daylight hours, this pay back is limited.

          "If you can use the power during daylight hours, then the reductions in your power bills will serve as good pay back. But if you don't use your power during daylight hours, this pay back is limited."

           Reply   0
          This depends on the area you are in, as if you are on a fixed feed in tariff you may be selling back more to the grid than you purchase.

          Last edited 15/07/15 10:44 pm

    A big note# Batteries only work if the Solar solution is on your side of the divide. Most states still have regulations forcing you to place your solar on the power company's side of the meter. There are trials happening in some states (SA has one now) but there is significant push back from the power providers because once we have batteries our reliance on the power companies will significantly erode.

    Edit:- looks like the article was a cut and paste from the US with no mention of AU regulations.

    Last edited 15/07/15 12:15 pm

      Nope, not a cut and paste from any US source.

      (but the point about batteries is well made, within the broader point that as a 101 article, it's a wide view of solar power as it stands, not an in-detail every-single-point-covered piece. Always happy to have reader feedback.)

        Thanks for the article, solar is something my family and I are looking into so its great to have this information.

    @awnshegh Yeah, seems like a shame now that we went and privatised our power companies. I can't imagine a government controlled power sector trying to stop you from reducing reliance. As someone who worked at a power distribution company, privatising the poles and wires is one of the stupidest things a state government can do. You go NSW, private natural monopolies ftw.

    Last edited 15/07/15 1:21 pm

    I just went through installing a quality system. As it turns out, if you want to go on a contract that gives you the feed in tariff with your electricity supplier, your kwh rate goes up, and your supply charge goes up. So you're using less power, but they are charging you more for it. Sounds fair...

    Also I used https://www.solarquotes.com.au/ - was pretty good!

    We are in NSW and have just installed a second system on our home roof. 2 converters, 2 sets of panels. The original 1.4kw set exports 100% to the grid and was installed years ago. It is still providing us 60c kW/h for all the electricity we feed into the grid. The second 3.5kw set was installed 2 months ago and is on nett metering. So whatever electricity our home needs during the day it is first drawn from the solar panels and then anything excess is exported. We don't get paid a cent for exports - but because I work from home and my wife and 2yr old are in the next room it makes sense to do this rather than pay out 50c kW/h during peak times. Our power bills are basically zero now and we use around 30kw/h on average per day.

      That would (to my understanding) be because you're on a legacy system and getting the gross tariff for your primary system; for new installations in NSW those kinds of rates appear all but impossible to get.

      (or in other words, I'm impossibly jealous right now...)

        @alexkidman before you get too jealous, ask how much they paid for the system when they were entitled to higher feed-in-tarrifs. My folks have a 5kw system in Victoria paying them a 63c FIT locked in for another couple of years (was originally a 5 year contract). I have a 5kw system on my roof, for which I am only getting market rates (4c/kwh feed-in). ... but they paid $16,000 for their system. I paid $5,000. (Thanks to the fact that solar's got a whole lot cheaper as they've become more common)

          Yep, my folks are the same, purchased a 4.5KW system on the 60c feedback system, cost around $20k at the time. I purchased a 4.5kw 3 yrs ago for $6k and only get 6c feeback.

          IMO well worth the investment in our case. We have a pool, so the pump (1KW max unit) runs for several hours during the day, doesn't add anything to the electricity bill, also making sure to run washing/dish washer/dyer during daylight hours and replacing lights bulbs with LED bulbs as they die has decreased our quarterly power bill from $800 ish to under $300. Using that math, we have paid back the cost of the panels and are now on average $500 per quarter better off!

        Funnily enough we paid nothing for the original 1.4kw solar system as the previous owner of our house put it in :) We are not supposed to be getting the 60c feed in Tarif... As it's supposed to drop with a new owner... But who am I to point this mistake out to the power companies?!!

      It is a pity that you cannot swap them around, but that is not legal.
      Of course you need to make sure you use as much of your own generation as you can.
      Heating, cooling, cooking, washing on every sunny day.

    A point not explicitly made is that the rules can be changed at anytime, as they have been the past, and fees or payments can be changed. Plus there is always a flat fee or a connection fee that is unaffected by how much electricity you feed in to the grid.
    We are considering adding batteries, when the price is right, to our grid connected system. But it solar installer is recommending we stay on the grid, using it as an emergency back up in case or solar system ever goes down.
    I like the idea of being completely off grid because of having freedom from the power companies. However, if everyone did that, there would be a lot of wasted electricity since we would not be pooling our resources via the grid.

    Solar generation of electricity is great and I have had it for years.
    There a few points to think about.
    It would be fantastic to go off grid because the power companies are going to increase their daily connection fee.
    The faster better and cheaper batteries are developed the more people will go off grid.
    However even if this does not happen the rules and tariffs are going to change because governments want their dividend.

    Just look at the past and present happenings
    Most of the thoughts from governments and power companies are to make it more complicated
    so it cannot be understood by the ordinary man/woman in the street, much the same as the mobile phone companies.

    Bit of a late reply, but... are there any solar power options for people who rent other than the landlord installing it? I'm thinking something portable that can be relocated and "plugged in" somehow. I would guess not... at least not yet. But never hurts to ask!

    Big cheap DIY carbon-aluminium batteries for home use on the way. Game changer.

    Watch this space.

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