What’s the cheapest way to get solar panels installed… and is it only worth doing on a south facing roof?

When it comes to adding green technology upgrades to their properties, more often than not the first port of call for homeowners is solar panels.

Homes across the country have been fitted with photovoltaic cells, and there is little sign that uptake will stop. 

In fact, solar panel installations have hit a seven-year high, with 161,494 panels installed on homes in 2023, increasing 44.6 per cent from the year before.

Since 2010, the cost of solar panels has tumbled massively, meaning that the technology is more accessible than ever.

When installed on south-west or south-east facing roofs, solar panels only lost 15 per cent of their efficiency

Despite their apparent popularity, however, only just over four per cent of the UK’s 29 million homes have been fitted with solar technology.

We spoke to two green energy experts to shed light on whether solar panels are worth the investment.

How do solar panels work?

Solar panels harness radiation from the sun, turning it into electricity using a process called the photovoltaic effect.

‘When sunlight hits the silicon [panels],’ Scott Duncan, head of solar and storage at OVO told This is Money, ‘it causes the electrons in them to start moving around – this movement creates electricity in the form of a direct current, which is then converted into an alternating current. 

‘It is this AC electricity that can be used to power our homes.’

Solar thermal systems can also be used to supply hot water to your home, even on a cold day.

Making use of the sun’s light radiation as an energy source reduces our reliance on non-renewable sources of energy and can save you hundreds on your energy bills in the long run.

Has the technology improved in recent years?

‘Solar energy efficiency has improved significantly in the last decade,’ according to Duncan.

He said: ‘In just over a decade, the average solar cell efficiency has increased from 15 per cent to 22 per cent – representing a big jump in potential energy bill savings.’

Scott Duncan says an increasing number of housebuyers are eyeing eco-friendly homes

The improvements to solar cells have come in the form of improved designs, more effective materials and better manufacturing processes.

Simkins added: ‘Battery energy storage is now fitted with the vast majority of installations, allowing solar power to be used whenever it is needed.’

Duncan agreed, pointing out that battery costs fell 14 per cent in 2023.

‘Increasing numbers of customers choose a battery with their solar panels – without one, you either use electricity as you generate it, or you export it back to the grid,’ he said.

‘Adding a battery will mean adding more to the cost of your installation, but it means you can store energy and use it later when you have greater need for it. 

‘So that if you’re out at work during the day you can benefit from your panels when you’re home in the evening.’

I don’t have a south facing roof – does that matter?

In short, no.

Over the course of a day, a south facing roof will receive the most amount of sunlight, meaning that solar panels mounted facing south will be most effective in producing energy.

However, roofs fitted with panels that face east or west can also effectively generate energy from the sun.

‘Considering how much prices have dropped over the past decade, combined with the high cost of energy, there is an argument to simply put as many solar panels on your roof as you can,’ Gareth Simkins, senior communications advisor at Solar Energy UK told This is Money.

In fact, while the most effective positioning of solar panels is at a 41-degree slope on an unshaded south-facing roof, Duncan said south-west and a south-east facing roofs will only lose around 15 per cent efficiency compared to those facing directly south.

‘Any decent surveyor should be able to talk you through how the orientation, both vertically and from due south, will affect the performance of a solar array on your roof,’ Duncan added.

What about feed-in tariffs?

The feed-in tariff initiative, which allowed those with solar panels to sell the green energy they produced back to the National Grid, was scrapped by the Government in 2019.

The scheme had seen all energy suppliers pay a fixed rate for the energy that solar users exported back to the grid.

Those who signed up prior the closure, will still be entitled to their 20 years of payments under the scheme.

Despite the end of the scheme, Simkin’s said: ‘Solar power is still a great consumer prospect, largely due to the savings it offers compared to buying power from the grid.’

With the scrap of the FiT scheme though, came the introduction of the Smart Export Guarantee. 

This guarantee offers solar users rewards based on how much energy they export back to the grid, with rates varying depending on your energy supplier.

According to Duncan, almost half of people don’t know that you can still earn money by selling energy back to the grid.

What’s the cheapest way to finance them?

While sure to bring down your energy costs in the long run, solar power doesn’t come cheap, with the costs involved making the greener option inaccessible for many.

On average, the panels will set you back £5,875, according to Barrows and Forrester.

However, financing plans have recently become available from UK providers which can help you spread the cost of installation.

Gareth Simkins says solar panels can help to future-proof your home

‘Paying for a solar power installation via finance is common in the US and the continent, but historically has not been common in the UK. 

‘Otovo and Sunsave are among those now offering it,’ Simkins said.

Similarly, Ovo’s Duncan points to the provider’s zero per cent financing plan which allows customers to spread the installation cost over three years.

A group purchasing scheme offered by Solar Together, which is backed by various local councils, can also reduce costs by offering groups of residents more competitive prices for installation.

When looking to cut costs, you may find yourself favouring a cheaper quote for installation. 

It is important, Simkins told This is Money, to avoid cowboy traders by making sure ‘that your installer is registered with [standards body] MCS.’

‘MCS makes sure that installers are properly trained and only use products approved for safety and performance,’ he said.

Are there any grants available?

Lower income households could be eligible for government grants, with the ECO4 scheme offering government funding for eco-friendly home improvements.

The scheme is open to people whose property has an EPC rating of D,E,F or G. 

However, applications are not accepted for band D properties, as energy companies can only spend 15 per cent of their funding on these homes.

The Home Upgrade Grant is also available for homeowners in England who don’t use a gas boiler as their main heating system and whose home also has an EPC rating between D and G.

Is a smart meter a must have with them?

The good news for those who prefer to avoid smart meters, is that you don’t need a smart meter installed in order to have solar panels, although you might need one in order to qualify for the SEG rates offered by energy providers.

‘It would be sensible to get one,’ Simkins told This is Money.

‘They help keep you track of the panels’ performance and make informed decisions about your energy use.’

Will they add value to my home?

Installing solar panels could add around £11,500 to the value of your home, according to Barrows and Forrester, making you a tidy profit of around double your initial investment, while also reducing your energy bills.

Simkins backed this, adding that ‘research for its Value of Solar Property report found that a solar installation increases the sale price of a home by more than half the cost of installing it in the first place, even before reductions in running costs are considered.’

‘They also help future-proof a home, by providing power for electric heating and vehicle charging. For new homes, they are increasingly a consumer expectation and are expected to become mandatory under the Future Homes Standard.’

Duncan added: ‘Ovo’s data also shows that more and more prospective buyers are prioritising green technology installations in their search for a home, meaning there has never been a better time to invest in green technologies like solar panels.’

Are solar panels worth having?

The cost involved with installing solar panels may make you think twice, but for many, the outlay will be recouped over time.

On average, a home will use 2,700 kWh of energy over the course of a year, according to the experts, which would be more than covered by the 3,180 kWh that would be produced by 12 solar panels installed on your home, and leave you excess to sell back to the grid at via the SEG scheme.

But it all depends on how suitable your home is for solar panels. 

The rising popularity of the eco-friendly upgrade suggests an increasing number of people are capitalising on the technology to bring down their energy outgoings, possibly because of high cost of energy in the winter of 2022/23.

Simkins adds: ‘Well over a million solar households can’t be wrong. Almost 190,000 small-scale rooftop installations were made last year, according to standards body MCS, which is a post-subsidy record,’ he said.

‘With installation costs continuing to come down, and more options cropping up to make the upfront investment more accessible, rooftop solar panels are a more compelling option than ever before as a renewable energy solution in the UK,’ Duncan added.

Have you had a solar panels fitted in recent years? Let us know your experience, good and bad. Or are you tempted, but have questions about installation? Get in touch: editor@thisismoney.co.uk