Prices vary hugely between renewable energy installers
Posted by Cathy Debenham on 27 November 2009 at 11:17 am
Prices for renewable energy installations vary wildly, making buying decisions difficult for homeowners, according to Power from the People, a new study by researchers at Oxford University’s Environmental Change Institute. In addition, there is little correlation between price and the generation capacity of the installation in many technologies.
Researchers Noah Bergman and Christian Jardine analysed the data from the first two years of the Low Carbon Buildings Programme grants scheme for homeowners. The most extreme example of price difference they found is in wood-fuelled boilers where the prices for 14.5-15kW boiler ranged from £3,175 to £16,479 – a more than fivefold difference.
This reflects my experience when we renovated our house in 2005. We were so confused by the conflicting information that we bought an efficient gas boiler instead. It’s depressing to find that it’s still a problem and that the market hasn’t developed. But it does confirm the need for the recommendation service that YouGen offers (if you have installed renewable energy, please help others to choose by rating your installer).
The difference in biomass boiler prices can partly be explained by technical differences of the models and differences in the installation costs. There was no correlation between total cost and the expected thermal output of the boiler.
Solar hot water systems (solar thermal) are also subject to a huge range of prices with most in the study varying between £1,000 and £8,000. The range can partly be explained by the relatively low equipment cost, site differences and scaffolding needs leading to significantly different labour costs. But Jardine and Bergman also found that profit margins are highly variable. They concluded that solar thermal “has poorly reported energy capacity and savings, suggesting many consumers are not getting a good deal and providing some evidence of the notion of ‘cowboy installers’ in the market”.
The cost of ground source heat pump installations varied by a factor of four, although here they did find some correlation between the total cost and the thermal output. The disruption involved in laying the pipe work is likely to contribute to these differences.
Cost and installation size appear much more closely related for the electricity generating technologies of wind and solar. The cost of components is a much greater percentage of the total in solar PV installations. With only a few wholesalers in the UK, there’s little variation between costs of the equipment, and a relatively smaller variability in installation costs and profit margins.
By showing price trends and setting benchmarks Bergman and Jardine hope to make it easier for buyers to know what sort of price to expect. Bergman also suggests getting a few estimates; asking for recommendations; and asking the installer to break down the price, so you can identify and compare the different costs involved.
The average prices they identified are as follows:
Fixed costs £2,000
Equipment £5,000 per kWp installed
Example: 1kWp installation should therefore cost around £7,000, and a 2kWp installation around £12,000 (although there are signs of a 10% price drop over the two years analysed.
Fixed costs: average of nearly £3,000, but varied considerably
Equipment: £500 per 1,000kWh/year
Example: a 2,000kWh/year system should cost an average of £4,000.
Ground source heat
Fixed costs: average £4,400, but variable
Equipment: £460 per kW thermal output.
Example: a 10kW GSHP should cost an average of £9,000.
Wood-fuelled boiler system
Average cost: £8,900, with high variability and no correlation to thermal output of the system.
The mast-based 5kWp Iskra AT5-1 cost an average £18,425 (£3,650 per kWp).
The mast-based 6kWp Proven Engineering WT6000 cost an average £19,170 (3,200 per kWp).
Photo by Sean Pants
Need help with any Jargon?By Cathy Debenham
If you have a question about anything in the above blog, please ask it in the comments section below.
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