Element Magazine - July 2014 Element Magazine - July 2014 | Page 9

BUSINESS

S LAR

Choosing the
right solar array
You’ve decided to join the solar
revolution and have a crack
at turning the sun’s energy into
electricity to power your home or
office – great stuff! Now it’s time
to figure out – how big?

By James Russell

T

he solar equation is a slippery thing – be it on a global
or local scale. Projected global solar booms have been
forecast before, but this one looks like it’s for real – thanks
mainly to the dropping price of solar panels over the past
five years.
So, now you’ve committed to getting solar panels on your
home or business, some maths is required to ensure the
time it takes to pay off your system is as short as possible –
ensuring your investment is a good one.
Some power companies pay you for the excess power
you generate, some don’t. Of those that do (see sidebar),
rates can vary, and power companies don’t particularly
enjoy handing you a cheque at the end of the month, rather
than the other way around – although this is possible.
The average home in New Zealand uses around 25kWh
(kilowatt hours) per day.
A 2Kw (kilowatt) solar PV system will generate 2
kilowatt hours (kWh) of power for every hour of sunlight.
NIWA statistics show that in summer, in Auckland, the
average hours of sunshine a day is 6.5 (October to March)
and the average daily winter sunshine hours is 4.6.
In the summer a 2Kw system could be generating
around 12 kWh per day. In the winter the system could be
generating around 9kWh. It’s reasonable to use five hours
of sunlight per day as an average.
In a perfect world, with panels aligned due north, on a
30 degree slope, you’d get 10kWh a day. It’s more likely,
therefore, to be 8kWh per day, or 2920kWh a year. At 0.27c
per kWh (about what the power companies charge you)
this is $788 worth of power.
Now to calculate the return on investment (ROI) on a
system. If you use all the power your array produces in

your home or business, you can divide the total cost of
your system by your savings per year to get your ROI. In
this example, a 2kW system costing $7500 will take 9.5
years to pay off ($7500 divided by $788), without taking
into account our ever-rising power prices. For a system
that produces electricity for at least 25 years, that’s not
bad going.
For a home which uses the New Zealand average of 25
kWh each day, it’s not hard to imagine using up to half of
that power during sunlight hours, particularly if people are
in the building during the day. If they aren’t, it’s possible
to put a bunch of appliances on timers – towel rails,
dishwasher, washing machine, dryer – even water heating
– while the sun is shining.
Here’s where it gets interesting. Now triple that solar
array to 6kW. You’re now producing 24kWh each day on
average. You’re still using some of that power, but the
rest is being exported to the grid. Your power company
pays you well for some of it, but as soon as you get over
a certain threshold, the price you get for your panels’
electricity is very small indeed – as little as 3.5 cents per
kWh. In this case your return on investment isn’t so rosy,
and payback times may balloon out to 15 years or more.
Therefore it’s important not to go too big.
A large number of homes are now wired up to the grid
using smart meters, which let you know your home’s
electricity usage to the half hour, extremely useful for
choosing solar array size. You can see exactly how much
power you use during daylight hours, and buy a solar array
to suit. Element’s recommendation is to buy an array that
produces 5kWh more than your use during sunshine hours
– those 5kWh hours can still be sold back to the retailers
for a decent rate, while at the same time you’re covered for
any changes in your lifestyle.

“As soon as you get over a certain
threshold, the price you get for your
panels’ electricity is very small indeed.”

What electricity
companies pay you
When you use your own generated electricity,
you save buying at the retail price. Here’s what
companies can offer if you produce more than you
use and export to the grid;
Contact: 17.285c per kWh for a peak load of less
than 10kW.
Genesis: 5.25c – 5.95c per kWh depending
on location.
Mercury: One for one offset of export and import
provided exports are less than import. 3.5c per kWh
over that.
Meridian: 25c per kWh for the first 5kWh (per billing
day), 10c per kWh after that.
Nova Energy: Buyback offer under review.*
Trustpower: 7c per kWh.

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