5 Must-Dos before making an investment in on-site solar PV
We are increasingly being asked by clients to assess quotations from renewable energy installers, most notably for solar photovoltaics, battery storage and heat pumps. Our investment appraisal service has been highlighting several common issues with our clients’ approaches and, more worryingly, with the contractors they are employing to install schemes. Many installers are mis-selling or overselling schemes, and some are charging clients to make expensive grid applications which are doomed to fail.
In this first in a series of three advice notes (on solar, storage and heat respectively) we’ve created a list of five MUST do activities before you make any behind-the-meter solar PV investment and before you commit to the services of an installer.
- Review your site energy demands and get a solution to fit your needs – putting a solar array of pretty much any shape/size on a roof would once have given good returns, but that is not the case since the Feed-In-Tariff scheme ended. Achieving appropriate investment returns from renewable energy is achievable now, but far less straightforward. You must first review the, volume, shape and pattern of site electrical demand throughout the day and throughout the year, and then make sure any new scheme is sized appropriately to offset energy import into the site. An oversized scheme will ‘spill’ energy onto the grid for relatively low export revenues and will result in a lower return on investment. An independent expert review of any proposed renewable installation is, therefore, crucial – and some technologies will be better options than others for different sites. In more than one proposed solar installation case we’ve seen, the best option for the client wasn’t solar at all, with their greatest value being from making better use of the energy investments they already had in place.
- Get grid connection applications prepared by independent experts – since 2018 Distribution Network Operators have been able to charge fees to process connection applications – with some charging in excess of £8,000. A solar installer had persuaded one of our clients to pay application fees of £4,500 in fees for a proposed on-site solar scheme. The application was inappropriate and, consequently, failed to meet the client’s needs. £4,500 wasted. In addition, the installer had put the application in its own name, so the client had exposed itself to the potential of the installer ransoming the grid rights in exchange for an installation contract.
- Put schemes out to competition between different installers – once you have had your optimal scheme technology, size and configuration identified (and the grid connection offer secured in your own name) you should put this specification out to competition to three of the best-performing solar installers for your proposed system size and location. You can then ensure you are getting the most appropriate system for your site, at the lowest cost – and from the very best installers.
- Guard against profiteering installers – unfortunately, installers are invariably opportunists. We’ve seen many cases where installers just want to sell clients as much solar as they can get away with. It’s crucial to compel your installer to put your best interests over their own.
- Seek specialist, expert and independent technical, strategic and tactical advice – it’s important to have your site and any potential for schemes reviewed by an independent expert before committing to any system or installer. Making the wrong decision could be expensive.