Residual Income Opportunity
You may be missing an excellent opportunity to generate residual income from your farm property. The case study below shows how an initial investment of £60,000 to install a 50kW solar array can produce over £12,000 a year in income. There are few business opportunities right now that can match this level of return!
How It Works
Your solar PV installation supplies power during the day when it is generating from the Sun and the National Grid takes over supply at night. This is ideal for commercial properties as they mainly consume energy during the working day. You would typically be earning 20.0 - 26.0 pence per unit directly from your sublet consumer, rather than the 4.5 – 11.0 pence per unit paid by your local supplier when you export the same power to the National Grid. That said, the export model still generates good returns.
A solar PV installation just sits there and generates power. You have nothing to do except claim your SEG payments every 3 months and invoice any on-site consumers. Ideally you should be looking to install a 50kW system as this is where the returns are highest. See the section below for more information.
Case Study - 50kW Solar PV System
200x HJ Solar 250W Panels with 3x SMA Sunny Tripower 17000TL inverters
| Loss Factor | System Size | Annual Irradiance | Shade Factor | Annual Energy Output |
| 0.8 x | 50000 kW x | 913 x |
1 = | 36,520 kWh/yr |
The investment should increase as energy prices rise. At the moment, this price increase is around 7% to 9% each year (according to DECC). Smart Export Guarantee payments are guaranteed by the Government to increase in line with inflation.
The following table shows the accumulated earnings over the next 1, 5, 10 and 25 years.
Fuel savings are based upon you using 100% of the electricity you generate at an electricity pricing of 26.0 pence per unit.
SEG payments are based on feeding all to the National Grid based on 11.0 pence per unit.
The annual CO2 saving of 19,246 kg is based upon 0.529kgCO2/kWh
| Year | Fuel Savings | SEG | Carbon Savings (kg) |
| 1 | £ 9,130 | £ 4,017 | 19,246 |
| 5 | £ 53,547 | £ 23,561 | 94,457 |
| 10 | £ 132,176 | £ 58,158 | 184,602 |
| 25 | £ 666,123 | £ 293,094 | 431,095 |
Energy Production
The production of electricity over the year is not evenly distributed as naturally, it relies on the seasonal behaviour of the Sun. Any generation of power over the amount directly used is wasted as it is not saving on any costs. This must be balanced by the extra generation in winter months. As a general rule, for systems of this size, the extra cost of installation is not offset by winter usage if the summer peak is more than 20% of the usage.
A 50kW system is a very good fit, getting close to the maximum return available on installation costs for a system of this size.
The G99 Engineering Standard - DNO Application
Before we can confirm any installation over 4kW in size we will need to seek permission from the Distribution Network Operator (DNO). This is normally a formality, however there are some costs involved. We anticipate these and always include the standard cost of making an application within our design proposals. Occasionally however, they can be high and could even prohibit the installation if the local transmission network needs extensive upgrading. This requires some preliminary documentation to test the feasibility of the installation with the DNO. After 12 years in business, we have a great working relationship with our local office and turnaround times are often much more swift than the typical 10-12 weeks that they quote if approached directly.
Farm properties and other commercial sites are usually set up for at least 100Amps per phase, but we will not know the state of the transformer between your property and the local transmission network until we have submitted the G99 application on your behalf.
The DNO may allow the installation with the existing transformers, which is what we would expect and is what typically happens.
Alternatively, the DNO may allow the installation but require that the local transformer is replaced or upgraded. This will carry a significant additional cost. Transformers of this kind tend to be around the £3,500 mark but the size of the installation costs are entirely at the discretion of the DNO. We would of course present any additional cost before commencing any work on site.
Before any final agreement we will carry out an extensive survey of the property/ies, including the electrical systems and construction materials to ensure that the installation will comply with all applicable Building Regulations and Health & Safety standards.