Good news for Solar Panel Households

The rate of return for domestic solar PV at is at a near record high thanks to a 62% drop in costs!

Research released by energy website Green Business Watch analyses domestic solar panel costs, savings and returns from the launch of the Feed in Tariff in 2010 to 2014.

The report finds that median installation costs for typical domestic solar panel systems have fallen by around 62% since 2010. It analyses available cost data, together with FIT rates and electricity price data to compare costs and returns available from solar panels at various points during the period. It shows that the rate of return on investing in domestic solar PV is significantly higher than when the scheme was designed, despite reductions in the Feed in Tariff. The rate of return for a well sited 2.6kW solar panel installation has risen from an estimated 4.12% in 2010 to 7.81% in 2014.


This study highlights the impact of falling installation costs and rising electricity prices over the last few years, which have offset reductions in the Feed in Tariff rate. FIT rates are guaranteed by the government and index-linked for the 20 year term of the tariff. They are also free from tax, making the returns from solar PV even more attractive.

Green Business Watch Editor Alastair Kay commented, “We wanted to compare how tariff rates, cost reductions and rising electricity costs have affected solar as an investment in the last few years. It is pretty clear that well sited domestic solar is providing really attractive returns, significantly above those when FIT started in 2010.”

He added further, “A system that would have cost £13,000 in 2010 may be under £5,000 today and that makes solar panels an option for more and more households, which is great.”

You can read the full report here :