Finding the right components

To find the best renewable system, you’re going to need to:

• decide what system components to get
• shop around for different types, brands and sizes of systems;
• describe each system in terms of its specification;
• make a few other assumptions;
• simulate each system;
• choose the system with the best NPV.

Deciding on components

There are many components out there: solar PV panels, thermal panels, heat pumps, energy storage and, of course, insulation.

In many or most cases, adding a single component does not make optimal financial sense. For example, without adequate insulation, replacing a gas boiler with a heat pump could dramatically increase your heating costs.

Also, heat pumps consume large amounts of electricity during the day and often benefit from a storage battery in order to access cheap night tariffs.

The same is true for solar PV panels which earn more from solar electricity when it is exported at peak evening rates … requiring a battery.

Solar PV is not the only form of renewable energy generation. Heat can also be generated from thermal panels and stored in water tanks. However, where a heat pump is to be installed, it is normally more economic to use heat water via a heat pump from solar PV generation.

Solar PV is not the only kind of renewable generation. Wind turbines are an alternative. While they make great sense on industrial farms, mounted high on masts on hilltops and out to sea, they seldom make any economic sense in domestic situations – and are best ignored.

The “holy quartet”

For the foregoing reasons, and to keep things simple, we are going to focus on finding an optimum (i.e. most financially profitable) combination of up to four components:

• insulation;
• solar PV;
• electrical storage battery;
• heat pump