Coastal Rocks

Solar energy isn’t free

While the idea of something being free is music to our ears, we should all be aware that these days, nothing in this world is truly free. Everything has some kind of cost. Your neighbour handing out free lemons is indeed of no expense to you, but there are costs to produce those lemons such as the land, labour, water, fertiliser, or even the seeds that grew the tree in the first place. You might then ask, what about free shipping? Well, that shipping was the result of a purchase. When thinking of solar energy, many of us assume it to be the ultimate energy solution – environmentally sustainable and… free? Surely, we don’t pay for the sun to shine.


Tree leaves with sun shining through

Solar power is created from using sunlight and turning it into electricity, typically through solar photovoltaic (PV) cells, known as solar cells. These cells are designed and arranged to maximise electricity generation, creating the foundation of a solar system - solar panels. It is these panels and their upkeep that are ultimately the hidden cost behind the creation of this “free” electricity. The average cost of solar installation for a Victorian home is approximately $5000. However, prices are dependent on the solar system size, that is, the maximum output of energy required for the unit. Larger, commercial buildings require a larger system, increasing the cost of installation - see table 1 below. Prior to rebates, a commercial solar installation will cost $1,200-$1,500 per kW installed


Even after the installation, there are costs associated with the electricity your system generates. To ensure your solar is generating at the expected rate, we will need to monitor it and diagnose any unexpected dips in generation, constantly maintain the equipment for safety and performance, and replace components as they near the end of their life. Hence, solar energy costs for energy usage will still apply but at lower costs than your standard retail energy and of a different nature. Despite these costs, solar energy has been shown to provide significant savings. Typically, we have found that our customers can save up to 30% off their energy bills. The larger system results in increased efficiency, producing more power at an even lower cost. Altogether, these reduced costs are the key reason why many are seeking solar energy today. However, the high costs and complexity of installation, maintenance and monitoring can often prevent many from adopting solar energy.


Solar panels and the sky

Fortunately, there are ways to have access to solar energy without the upfront costs - financing the equipment is one option but this still leaves the owner with the ongoing burden of monitoring and maintenance to ensure they are getting the most from their equipment. Another option which does take away the costs and burden of maintenance and monitoring, is through solar power purchase agreements (SPPA). Unlike traditional retail energy, solar PPA providers have ownership over the equipment that generates the electricity and are responsible for all duties including installations to maintenance and repairs. This means, the only responsibility of the buyer is to ensure there is appropriate space on their roof for the fitting of that solar system and of course, to pay their reduced energy bills.


Moreover, the adoption of solar energy is growing rapidly as the world’s growing energy needs continue, highlighting the economic benefits many are realising. Not only will you be reducing your electricity bills significantly, but you will also be contributing to a greener and more sustainable future. The environmental impact of solar energy is minimal at worst. Solar energy does not have any direct green-house gas emissions from energy generation. While the production of the PV cells do result in emissions, these are far less over their lifetime compared to both production of other renewable energy generating equipment or CO2 emitting forms of energy in Australia such as coal, petroleum and natural gas - see figure 1 below. Rest assured, improvements in technology, production and recycling of these materials will continue, resulting in even lower overall total emissions from production. You can find more information about solar panel disposals in our previous articles here.


Comparison of emissions: PV and conventional power plants
Figure 1: Comparison of emissions (adapted from Moss, Coram & Blashki, 2014)

Solar energy requires the use of solar panels and a team of professionals to install, maintain and monitor the solar system. While this means your energy bills won’t be free of charge after making the switch to solar, you can still expect to be significantly reducing your costs. The costs of your energy bills and those impacting the environment. Knowing that the electricity you are generating from your solar panels are without carbon emissions and the harmful impacts on the environment.


By choosing solar PPAs at Energy Terrain, you can assure your energy installation will be hassle and worry free. At last, there IS something free in this world! Interested to know more about solar energy? Check out our previous articles. Alternatively, you can contact our team for your commercial business..



References


Best, R., & Burke, P.J. (2018). Adoption of solar and wind energy: the roles of carbon pricing and aggregate policy support. Energy Policy, 118, 404-417.

Ethenakis, V. M., & H. C. Kim. (2011). "Photovoltaics: Life-Cycle Analyses." Solar Energy 85(8): 1609-1628.


Geoscience Australia. (n.d.). Solar energy. [Online] Available at: https://www.ga.gov.au/scientific-topics/energy/resources/other-renewable-energy-resources/solar-energy


Gudova, M. (2020). What is the average solar bill? [Online]. Castle Blue. Available at: https://www.canstarblue.com.au/solar-power/average-solar-bill/


Moss, J., Coram, A., & Blashki, G. (2014). Solar energy in Australia: health and environmental costs and benefits. The Australian Institute.


Solar Choice. (2019). Residential Solar PV price index for February 2019. Available at: https://www.solarchoice.net.au/blog/residential-solar-pv-price-index-april-2019/

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