As the overall cost of modern solar panels is decreasing, their efficiency is increasing, making them more cost-effective than ever.
Many thousands of homeowners are adding solar panels to their homes – the UK’s solar capacity has increased dramatically in the last few years with over 1 million new installations since 2010.
The small export guarantee (SEG) announced in 2020 is set to incentivise those who generate energy through renewable technologies including solar panels, providing solar panel users with money back on the electricity they export to the National Grid. It’s easy to enroll in and start earning from.
Whilst solar panels require a considerable upfront investment, it’s certainly possible for them to pay for themselves and eventually put the owners in profit after an average home ownership period.
This article will review the cost of installing solar panels in the UK, factors that affect the cost and other common questions surrounding installing solar panels.
Average Costs of Solar Panels in the UK
By retrieving quotes from 8 primary and 7 secondary sources, we discovered the following average costs for fitting solar panels in the UK. Prices include materials and labour.
Installation costs include the cost of a basic solar inverter which is required to make solar power usable to standard AC electrical appliances.
| House Size | System Size (Power) | Polycrystalline Setup Cost (Low/Mid-Range) | Monocrystalline Setup Cost (High-end) |
|---|---|---|---|
| Small Array For Flat or Terraced House | 8m² (1kW - 1.5kW) | £2,500 - £3,000 | £3,500 - £4,500 |
| Small to Medium Semi-Detached | 15m² (2kWp - 2.5kW) | £4,000 - £6,000 | £5,000 - £8,000 |
| Medium to Large Semi/Detached | 21m²- 28m² (3kW - 4kW) | £5,000 - £9,000 | £6,000 - £12,000 |
| Large Detached + | 28m²+ (4kW - 6kW) | £5,000 - £14,000 | £8,000 - £18,000 |
As we can see, the average cost of a home solar system is around £6,000, which is pretty similar to what the government expects it to cost.
Extra Costs
There are two extra costs to consider:
- Solar batteries
- Solar heating technology
Both of these costs are optional. Solar panels fitted as standard can only generate electricity as you use it, which means that they only save you money when you’re using electricity. Moreover, solar energy can only be used to heat water with the assistance of a solar hot water system.
Solar Panels and the SEG
The government intends to obtain net zero carbon emissions by 2050, and as part of that, they are incentivising homeowners that contribute green or renewable energy to the National Grid.
The SEG scheme is the current scheme and is likely to remain in place for the duration. It’s offered in partnership with energy companies and offers solar panel users a tariff for energy they generate with their equipment but don’t use.
This is just one saving – the other saving is that your solar power is obviously yours to use if you want to – and thus knocks money off your energy bills. So, solar panels help homeowners save in two ways:
- Through the SEG scheme
- By reducing the cost of standard energy bills
The SEG rate varies between 1p and 20p depending on the energy supplier. Social Energy, Tesla (via Octopus Energy), Octopus Energy, E.on and Bulb currently pay rates of 4p and above (correct as of October 2021).
Conditions of the SEG
The SEG requires a property to be fitted with solar panels certified by the Microgeneration Certification Scheme (MCS). The property will need a Smart Meter capable of uploading energy data to the supplier every half an hour.
Pros and Cons of Solar Panels
| Pros | Cons |
|---|---|
| Eco-friendly: Solar panels save between 1 to 5 tonnes of carbon each year. | Upfront Cost: Solar panels incur considerable upfront costs. |
| Save Money:Solar Panels pay for themselves in around 15 to 25 years. | Unsightly: Many people worry about the aesthetic appeal of solar panels. |
| Boost Home Value: Solar panels can boost home value in the event of a sale. | Not Suitable for All Roofs: Require roofs of a certain pitch. South-facing is nearly always the best in the UK. |
| Low Maintenance: Solar panels are very low maintenance once installed. | Payback Not Guaranteed: What you can earn on solar panels depends on your usage habits. |
| Perfect for Green Homes: Solar panels are ideal for homes that generate some other energy from renewables, have first-class insulation, etc. | Awkward If You Move: Solar panels are tough and expensive to move from one home to another, albeit not impossible. |
Can I Break Even Or Profit From Solar Power?
Solar panels pay for themselves over the course of around 15 to 25 years. Highly efficient setups in particularly sunny spots may pay for themselves sooner.
Higher powered setups are more likely to produce excess energy, meaning higher SEG tariffs and energy savings. This quickens their return on investment compared to small setups.
Below is an example of potential savings and the approximate duration it’d take to break even from a solar setup.
| House Size | Small Array For Flat or Terraced House | Small to Medium Semi-Detached | Medium to Large Semi/Detached |
|---|---|---|---|
| Solar Panel System Power | 1kW to 1.5kW | 2kWp to 2.5kW | 3kW to 4kW |
| Installation Cost | £2,500 - £3,000 | £4,000 - £6,000 | £5,000 - £9,000 |
| Energy Bill Savings Per Year (Approx) | £100 | £250 | £350 |
| SEG Payments After 25 Years (Approx) | £1,500 | £3,000 | £5,000 - £9,000 |
| Break-Even After | 15 - 26 years | 14 - 23 years | 13 - 22 years |
Are Solar Panels Worth It?
There are a few situations where solar panels are more likely to be worth it:
- You plan on living in your home for longer than 15 years
- You have a south-facing roof in a sunny location
- You’re eco-conscious and wish to lessen your carbon emissions in whatever way possible
- You’re willing to adjust your energy usage habits to get the most out of your panels
- Your home is otherwise eco-friendly with quality insulation
- You use electricity when throughout the day when the sun is shining
Solar panels are being incentivised by the government already, but in the future, there may be even greater encouragement (or even pressure) for homeowners to make the switch to renewables.
Those who invested in solar panels some 20 years ago have likely earned much of their investment back already, but since current solar technology is currently ultra-reliable, affordable and efficient, now is a very good time to seriously consider solar.
It’s also worth mentioning that solar panels can be added and removed, or even taken with you when you move house. They’re not permanently attached to a home.
Overall, solar panels are more attractive than ever and most homeowners should consider them if they have a free, sunny roof and are likely to remain in the house for 15 years or longer.
Does Location Matter For Solar Panels?
Modern solar panels are efficient in an array of light conditions, but the relationship between sunshine and energy production is still rather linear. More sun = better performance.
That said, solar panels in Scotland aren’t going to be vastly less effective than solar panels in southern England, provided they ideally face south and get direct sunlight unspoiled by shade from trees, buildings or anything else.
Money Saving Expert estimates the differences between northern and southern locations to influence energy savings by as little as 3 to 5% or less.
Choosing a Solar Panel System
1: Solar System Size
Solar panels come in all manner of sizes, but the size of the installation you can have is usually limited only by your roof space. Whilst solar systems can be installed on say, a garden or piece of land, this depends on your property and Permitted Development limits will apply.
The average solar system for a 3-bed or 4-bed semi-detached or detached house is around 4kW.
2: Panel Type and Quality
Not all solar panels are built the same – they have different efficiency ratings which indicate how well they convert solar energy into electricity. There are two main panel types; polycrystalline and monocrystalline, with the latter being the latest technology. Monocrystalline panels probably cost around 25% to 50% more for the highest-end panels.
Manufacturers of higher-end solar panels include the likes of LG, Panasonic, Canadian Solar, Sharp and Solar World. 20% is the typical efficiency rating for a high-end panel, with 14% to 16% being the lower range.
3: Installation and Extras
Solar panels are large, cumbersome and expensive. Fitting them is an expert job and easier installations will cost less. Everything from solar batteries to smart meters will also incur additional costs.
Moreover, the quality of the roof greatly affects the cost of installation. Sometimes, roof modifications will have to be made to improve the roof prior to installation. Loose or broken tiles will have to be fixed. This can add an extra £200 to £500 to the cost of installation.
Do You Need Planning Permission for Solar Panels?
Generally speaking, solar panels are covered by Permitted Development, which means homeowners do not need Planning Permission, subject to certain conditions.
Conditions may apply to buildings in conservation areas or World Heritage sites – check with the Local Planning Authority if you think this or something similar applies to you. Listed Building Consent is required for Listed Buildings.
Solar panels need to keep as minimal appearance as possible, must not be installed above the highest part of the roof and shouldn’t extend beyond 200mm from the roof. No part of the installation should be higher than four metres and the entire installation must be at least 5m from the property boundary. The entire array cannot be larger than 9 square metres.
Larger arrays can be fitted, but not under Permitted Development.
Furthermore, solar panels will have to be compliant with Building Regulations. Installers part of the Competent persons scheme can self-certify the work.
How to Choose a Solar Panel Installer
MCS accreditation is an absolute must. Look for a solar panel installer with a proven portfolio of local recent work.
Membership/accreditation by/to the Renewable Energy Assurance Limited (REAL), the Solar Trade Association (STA) or the Renewable Energy Consumer Code (RECC) is favourable.
Understand the type of solar system you’re looking for, as well as the rough size in kW. If you’re looking for a specific manufacturer/model of panel then that’s another consideration as not all installers will use all manufacturers.
In terms of warranties and guarantees, many installers offer their own guarantees, but manufacturers’ guarantees on panels typically last 20 or 25 years.
Ongoing Costs of Solar Panels
Modern solar panels are extremely weather-hardy and require little maintenance. That said, the dirtier they get, the worse they’ll work. Annual or bi-annual cleaning is a must, costing something like £50 to £100.
Of course, this is possible to do yourself if you don’t mind getting on the roof.
Aside from that, solar panels should last for as long as they need to and are generally very low maintenance.
Get Pricing on Solar Panel Installations Near You
We’ve done our best to give you a good idea of what you can expect to pay to install solar panels.
However, our guides are not a substitute for a fixed quote specifically for you.
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About the Author
Alex Johnson is a qualified quantity surveyor and writer with a passion for conducting original research and uncovering the true cost of jobs. His cost data has been referenced by EDF Energy and the Scottish Government.