How solar power can help with your energy bills

Harriet Meyer
·5-min read

Generating your own electricity through solar power can slash your energy bills and earn you cash, alongside boosting your home’s green credentials.

Solar power, also known as photovoltaics (PV), simply converts the sun’s energy into electricity. But you don’t need to live in a sunny climate for solar power to work. Fortunately for UK homeowners, the process relies on natural daylight and still works on cloudy days.

Here, we explain how this form of renewable energy can help with your bills.

How does solar power work?

Solar power harnesses the sun’s energy and turns this into electricity using ‘photovoltaic (PV) cells’. These cells are most commonly found in the UK on solar panels fitted to rooftops.

However, solar panels may also be installed on walls, or other areas of the home that receive natural light. A device called an inverter is also installed which switches the sun’s energy into a form that can be used by household appliances. You’ll typically find this machine on the side of a home, or in a garage or basement.

The brighter the sunlight, the more power the panels can generate – but, the panels can also make use of light that isn’t visible to the human eye, such as infrared and ultraviolet light. So, electricity is still produced during winter.

But solar panels won’t generate electricity at night. If you need power during the night, this’ll come from the National Grid through your energy supplier. That’s unless you’ve invested in a solar battery system to store unused electricity – but these can be pricey, and they aren’t necessary for everyone.

What should you consider before using solar power?

The first step is to ensure your home is suitable for solar panels. For starters, there must be enough space on your roof for the PV panels. The space where the PV panels will sit must also get enough daylight for the system to do its job.

Of course, you also need to think about whether it’s financially worthwhile (more on this below). The average cost of a system that should generate enough electricity for a three-bed, family-sized house is between £6,000 and £8,000, according to online quote service Green Match. This is a 4kWp (kilowatt peak, or how power is produced by panels) system comprising around 16 solar panels.

Your home must be eligible for solar panels too. You don’t need planning permission to install solar panels, but check with your local authority to see if there are any particular restrictions.

For example, you probably won’t be allowed to fit solar panels if you live in a conservation area, or your home’s a listed building. And if your property is leasehold, you’ll also need to get permission from your freeholder before installing panels.

Do you need a specific energy supplier?

You don’t need to be with a particular energy supplier to have solar panels fitted. Once your system is installed, your energy supply should switch between solar power-generated, and the energy received from your supplier.

You’ll also need a supplier for your solar power payments through the Smart Export Guarantee (SEG). Under this scheme, energy suppliers must offer you ‘tariffs’ for your unused solar electricity. This is the electricity you generate, but don’t use, that’s exported back to the Grid.

The SEG scheme, introduced in January 2020, replaced the government’s previous feed-in tariffs (FITs), but isn’t as generous. The amount you get ranges from around 1p per kWh to 5.5p per kWh.

You should shop around for the best energy and SEF tariff, just as you would for other deals, and review your options regularly to get the best rate. Gradually, the money you earn from the SEG combined with energy savings may claw back the cost of your solar power system.

How much could you save on your energy bills using solar power?

Used wisely, solar power can slash your energy bills by hundreds of pounds a year. But, of course, how much you save depends on the amount of energy produced by your solar panels, and whether you’re making use of this at the time.

The Energy Saving Trust has a handy solar energy calculator to work out how much power you may generate from solar panels, and how much you could save on your energy bills. For example, you could save between around £90 and £270 a year on your energy bill using a typical 4kWp system, according to estimates.

But ultimately, savings depend on your particular system, and electricity usage. Your system may be most financially worthwhile if you’re at home during the day using electrical devices, when the solar panels are generating electricity. That’s unless you use a battery storage device to store unused power.

Do any schemes help with the cost of installation?

The UK government is keen to push the use of renewable energy sources, but there aren’t any grants in the traditional sense that can help meet the cost of installing solar panels. Instead, there’s the SEG scheme (see above), which is aimed at helping householders recoup the cost of installation over the years.

If you want to find out more about the cost of installing a solar power system, get in touch with some Microgeneration Certification Scheme (MCS) certified installers. They can talk you through the kind of system that may be suitable, potential benefits – and pitfalls.

Bear in mind, too, that there are plenty of other simple ways to cut costs and reduce your carbon footprint, according to the Energy Saving Trust, such as paying by direct debit and using energy-efficient appliances.

You should also ensure you’re not paying over the odds for your energy bills even if you’ve got solar panels. You’re still able to compare energy tariffs to benefit from the best deals, and potentially save hundreds of pounds a year on your bills.