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Monday, April 6, 2015

Is R100,000 a lot of money?

A friend installed a solar PV system for R100,000, which uses partly solar photovoltaic electricity from the sun, partly batteries, and partly Eskom.

Was the R100,000 investment worth it?

In summary, the cost is R21,820 per annum instead of R29.591 per annum, but there are some assumptions, so read on. And that's just in the first year. In the second year the cost is R22,569 instead of R33,327.

Here are some calculations:

Besides the security of supply advantages and no load shedding advantages and reducing one's carbon footprint advantages and the advantages of all one's friends wanting to visit and see what one has done and the advantages of being able to continue working from home, assuming one does that, there is also a saving in what Friend has done, especially once rates go up in July 2015.

Some calculations:

R100,000 is R1,338 per month at 10% over 10 years. Or R16,056 per annum. Using the Standard Bank calculator at https://www.homeloans.standardbank.co.za/servlet/com.sbsa.sbhl.bondcalc.business.MainCalcServletInternet?page=Main_MonthlyRepayEntry

Note that the R2.10 per kWh tariff that I have used in the following calculations is the City of Cape Town Electricity tariff assuming a 13% increase in July 2015.

If Friend used 32 kWh per day and now uses 6 kWh per day in summer and he used 45 kWh per day in winter and now will use 9 kWh, then assuming summer is 6 months and winter is 6 months, then :-

32 kWh * 183 days + 45 kWh * 183 days = 5,856 kWh + 8,235 kWh = 14,091 kWh * R2.10 per kWh = R29,591 per annum.

6 kWh x 183 + 9 * 183 = 1098 + 1647 = 2,745 kWh * R2.10 per kWh = R5,764 per annum.

So he was paying R28,182 per annum and is now paying R16,056 + R5,764 = R21,820, which is less than R29.591.

He also switched to gas for part of his cooking, but he still has R7,771 to play with before he breaks even. And that is only in the first year. In the second year when prices increase by 13% again, his savings will be even greater as his cost will be R22,569 instead of R33,327.

1 comment:

  1. How did your friend get his consumption down to 6 and 9kWh?
    Why do you say "So he was paying R28,182 per annum"?