Is financing a photovoltaic system unprofitable?

Hello Orion,

Your calculation is unfortunately completely wrong.

(1) The system price for single-family house roofs (3-10 kWp) should currently be around 1300 - 1800 euros per kWp. That means if I now assume a system with 5 kWp, the investment is around 7000 - 9000 euros. Trend is falling.

(2) For the electricity you feed into the grid, you receive a fixed price per kWh (feed-in tariff). This price is set in the Renewable Energy Act. The feed-in tariff is guaranteed for exactly 20 years (+ the year of commissioning) and will not change during this time. How high the feed-in tariff is depends on the day of commissioning. Currently, the tariff is around 17.x cents per kWh – however, it decreases slightly every month – depending on the overall expansion of photovoltaic systems nationwide ("breathing cap").

(3) The electricity you consume yourself replaces the electricity purchase – that means the "earning" of the photovoltaic system is exactly the amount you don't have to pay for electricity. For me, the electricity price is currently around 22 cents/kWh – trend rising.

(4) The amount of electricity generated depends mainly on the location. Here in the Ruhr area, you can calculate about 850 kWh/(kWp*a), in southern Germany depending on the location also values of up to 1200 kWh/(kWp*a). That means the assumed photovoltaic system with 5 kWp produces 5000 kWh every year at an average location in southern Germany (assumed 1000 kWh/(kWp*a)). With full feed-in to the grid (assumed 17 cents), this brings in 850 euros income per year. Calculated over 20 years, that is 17,000 euros income with full feed-in. With partial self-consumption accordingly more.

(5) Yes, you have to assume that the inverter will have to be replaced once within the 20 years. Furthermore, it depends on the quality of the installed modules how much they deteriorate or not over the 20 years. Usually, a provision of 1 - 1.5% per year is calculated.

(6) Even after the subsidy expires in 20 years, the system does not immediately fall off the roof – that means you can still consume at least part of the electricity yourself – even if you no longer get money for the fed-in electricity...

(7) I currently see an increase in the self-consumption rate through storage of self-generated energy (batteries) rather critically. On the one hand, the batteries are still quite expensive, on the other hand, I have serious doubts about their longevity. But above all, the installation location must be viewed carefully. The current conventional battery technologies have significant disadvantages. Lead batteries can off-gas – then suddenly you have an explosion hazard area in your basement! Lithium cannot be extinguished in the event of a fire... Outdoor installation of the batteries is also not so easy, as all battery technologies react strongly to temperature fluctuations. That means ideally you would have to install the batteries outside the house in a well-ventilated building that has a constant temperature all year round... But even then, you still have the problem that you have DC lines running through the house to the batteries. This is a problem for the fire department in case of fire! So you also have to install a firefighter emergency switch that completely disconnects the DC lines. All of this increases the investment for batteries so much that storage is currently not profitable. It will probably look different in 5-10 years – but at the moment I would refrain!

So, I hope I was able to answer your questions a bit.

Best regards Micha

Hello Michael,

actually, I calculated most points the same way. Regarding the points:

(1) I based it on researched values. If I get more performance for the price, then that speaks in favor of photovoltaics.

(2) I calculated it the same way in my second calculation, but with 16 cents.

(3) I also calculated it the same way, 10% self-consumption at 25 cents.

(4) I calculated 1000 kWh per kWp on average, just like you. So the values match.

(5) In the second calculation, I used exactly this 1.5% provision per year.

(6) In the calculation, I naturally continued after 20 years as you said. Of course, I don’t know what the subsidy situation will be like then (if there still is any). But what good is a system with a performance of 5000 kWh if I only need 2000 kWh per year? Somehow I don’t see why I should distribute the rest at my own cost and feed it in if I get nothing for it.

(7) I agree with that too.

(7)

Hello Michael,

actually, I calculated most points the same way. Regarding the points:

(1) I based it on researched values. If I get more performance for the price, then that speaks in favor of photovoltaics.

(2) I calculated it the same way in my second calculation, but with 16 cents.

(3) I also calculated it the same way, 10% self-consumption at 25 cents.

(4) I calculated 1000 kWh per kWp on average, just like you. So the values match.

(5) In the second calculation, I used exactly this 1.5% reserve per year.

(6) In the calculation, as you say, I continued to calculate after 20 years. How the subsidy will look then (if it even still exists), I don’t know. But what good is a system with a performance of 5000 kWh if I only need 2000 kWh per year? Somehow I don’t see why I should distribute the rest at my own expense and feed it in if I get nothing for it.

(7) I see it the same way

(7)

1.) That’s exactly where your calculation error is. For 30 thousand euros you get 22-24 kWp, i.e., 22000-24000 kWh per year, which is 3300-3600 euros per year x 10 years equals 33 thousand or 36 thousand euros. In other words, the system is paid off after 10 years even with a loan. And here I haven’t even included the saved own contribution. Regarding point 5) you replace the inverter if at all, appropriate inverters currently cost about 3 thousand euros and certainly not more in 10 years. So choose an inverter with a 10-year warranty. Why don’t you post a picture of the roof and its dimensions?

Hello Orion,

Your second invoice somehow slipped past me.

But still, something doesn't add up - but I don't feel like recalculating now...

On the one hand, as b0012sm so aptly said, for an investment of 30 TEuro you really get over 20 kWp. My 1300 - 1800 euros were estimated for systems < 10 kWp. For systems > 10 MWp, the price is currently around 1100 - 1200 euros per kWp. Systems around 30 kWp are, of course, priced somewhere in between.

On the other hand, from experience I can tell you that in photovoltaics equity returns of 6-8% have been normal and relatively easy to achieve for years. There have been times in between when realistic equity returns of 15-18% were also no problem (suddenly sharply reduced system prices with complete over-subsidization by the government). In Germany, for example, this was the case in the first half of 2009. In 2010, returns were still in the double-digit range. Meanwhile, the structure of price and subsidy has settled down quite solidly again. I’m curious how it will continue after the next federal election...

On the topic of self-consumption, you have to be very careful *when* you actually consume how much electricity. In a single-family house where all residents are at work during the day, you will probably only achieve a very low self-consumption rate. Whether 10% can be achieved I don’t know - but “off the cuff” that already seems very ambitious to me. With (small) children who are home from noon - or older children who turn on the TV and PC after school - of course a higher rate is possible. If one of you has an office in the house and works every day in a home office, it will be even better.

Best regards Micha

You want to spend a huge amount. Have the whole thing calculated by a professional including location calculation and consideration. By the way, self-consumption is not explicitly shown anywhere, but is the consumption you use directly from the system itself. Accordingly, you have to do very little calculating there, because if the system is running at full capacity you won’t need the whole amount yourself and at night when you need electricity you produce nothing. Self-consumption also means spatial proximity between your consumers and the system. Do you have space on your roof for such a huge system? By the way: module prices are currently rising because foreign modules have to pay a tariff and German ones are almost sold out.

Hello everyone,

ok, then the numbers I found were probably extremely outdated (regarding performance). If the basic assumption is wrong, of course the whole calculation is wrong. If I get about 23 kWp for 30,000 euros, my return after 20 years would be around 70,000 euros compared to 50,000 euros from an investment. Or in other words: If I finance this, it would bring me about 70,000 - 50,000 = 20,000 euros "profit" in 20 years, that is 1,000 per year = about 80 euros per month. By the way, the 30,000 was only an example calculation. I probably wouldn’t even have that much space on my roof...