Let us help break down the most common causes that see power bills go up even after solar has been installed. Before we get stuck into it, it's essential that we go back to the basics and re-visit how your solar system is actually generating savings for you.
The visual above is a helpful reminder of how a solar system affects how your home gets its electricity:
*Note this is a traditional grid-connected solar system without a battery.
· The green line represents the energy produced from this solar system on a sunny day.
· The red line shows the household demand for electricity which is imported from the grid at whatever price the electricity retailer is charging.
· The blue line shows where the household demand is being met by the solar system's production, meaning that electricity is not being imported from the grid.
With the above visual in mind, we are reminded that a solar system helps reduce electricity bills in two primary ways:
1 - Self-Consumption: Reducing the amount of electricity imported into the home from the grid. This is the most significant form of savings, where each kWh that you use from your solar system instead of buying from your electricity retailer saves you the full cost of that kWh.
2 - Generating Credit: Where allowable, you would be paid a 'Feed in Tariff' for the excess solar that your system produces which you don't use, and instead, you sell to your electricity retailer. This 'credit' is calculated over your billing period and is put towards the cost of electricity you consumed from the grid.
So, how does the above information help us understand why bills may be increasing, even with a solar system on your roof?
The most common cause is that the cost per kWh of electricity imported and purchased from the grid has increased significantly, meaning the power you're buying is far more expensive! At the exact same time many electricity retailers are paying less for the excess electricity being exported to the grid during the day.
Previously, excess solar that was exported may have generated credit that offset a higher % of the power being purchased from the grid, now with higher rates for that power, and lower Feed in Tariffs, the remaining net bill can often be higher. This can be compounded in the colder months when some homes use electric heaters.
We have also seen many examples of homes installing solar and then significantly increasing the amount of electricity they use overall!
Now before you think to yourself that your solar system is to blame, the decisions to raise rates and lower Feed in Tariffs are made by electricity companies who are currently posting record profits!
There is one final point to consider, and we think your solar system deserves a token of gratitude as an unsung hero for this one: as the cost of electricity continues to rise, your solar system is actually saving you more than it was before!
How? For example, if your electricity used to cost you $.22/kWh and you used 10kWh from your solar system instead of importing from the grid, that was a self-consumption-saving of $2.20.
Now we are commonly seeing rates of $.36/kWh up to $.68/kWh and beyond, meaning that same avoided purchase of 10kWh was worth $3.60 - $6.80!
What can be done?
Unfortunately RESINC doesn't have any say over the rates that electricity companies are charging, so the main suggestions to improve the situation are:
· Load-shift where possible
· Reduce overall consumption where feasible
· Find a better electricity plan with more competitive rates for your situation
· Consider adding more solar panels and/or a battery to your system if this is an option
Solar-owners are usually familiar with the significant savings that can be gained from small shifts in habits, but now, more than ever, the benefits of 'load-shifting' are becoming a no-brainer.
If you can shift even 2-3kWh of 'nighttime' usage to when your solar system can provide you power during the day, that could lead to savings of nearly $400 per year.
Staying with the same old electricity company might be costing you as well - RESINC can help you compare the plans available to you, and potentially find you more competitive rates.
Understanding Seasonal Variations
In addition to the factors mentioned earlier, it's crucial to recognize the impact of seasonal changes on your solar system's performance. As we transition into winter months, customers who had their systems installed during the summer may notice a decrease in solar energy production – this is normal and to be expected!
During the summer, when the days are longer and the sun is higher in the sky, solar panels typically receive more direct sunlight, resulting in higher energy generation. However, as we move into winter, several factors contribute to reduced solar output:
1 Reduction in Peak Sun Hours: Winter months often bring fewer daylight hours and less intense sunlight, leading to a decrease in the number of peak sun hours available for solar energy generation.
2 Lower Angle of the Sun: The sun's angle is lower during winter months, causing longer shadows and increased shading effects on solar panels. This shading, which may not have been a significant factor during the summer, can reduce the system's efficiency.
For instance, a tree in a neighbour’s yard that didn't cast shadows on the panels during the summer might now obstruct sunlight during certain times of the day, affecting energy production.
It's essential for solar system owners to be aware of these seasonal variations and their potential impact on energy generation. While a decrease in production during the winter months is expected, understanding the reasons behind it can help manage expectations and plan accordingly.
A Detailed Breakdown / Example
Take a read through the detailed spreadsheet below for even further insight into how bills can increase due to changes in electricity rates - and also how much the power bills would have been without any solar!
If you'd like us to help assess whether there’s a more competitive electricity plan available to you, or you’re curious what a battery – or more solar panels could do for you, please send us an email on info@resinc.com.au with a copy of your latest power bill, and we’ll be happy to help.