Rooftop Solar Costs Far Outweigh the Benefits, According to Grattan Report

It has been growing in popularity over the years as we all come to embrace the potential of renewable technologies. It has even been given a boost in recent times by MPs in the UK saying that commercial rooftop solar is an important part of our energy provision now and for the foreseeable future.

While there are those who are still yet to be convinced that switching to solar can make that big a difference to their business, a new report from the Grattan Institute suggest that the cost of installing solar far outweighs any benefits. It’s caused something of stir in solar circles and got a good few renewables supporters hot under the collar.

With Tesla developing a better way to store electricity in their new batteries, the solar industry is currently pronouncing that our future definitely lies in harnessing the power of the sun. But if the Grattan report is correct then we may well all be heading down a blind alley where cheap and renewable solar energy is concerned.

The Grattan Institute is based in Australia and has recently stated that the cost of solar installation and maintenance was $9 billion over and above any benefits that come from things like the Feed in Tariff or other incentives. The problem is that the Grattan report is based, according to many experts, on a mishmash of figures and a bunch of wrong assumptions and calculations.

According to the Guardian, one of the main mistakes (amongst many) the report makes is to base its calculations on the lifespan of solar panels being around 15 years. Most panels are designed to last much longer than this and some installations may well last another 10 to 15 years if looked after properly. Take into account the amount of reduced cost electricity and the benefit of the Feed in Tariff, which they also operate in Australia, as well as the lowering of prices as more power production comes online, and the figures start to look a lot different.

The report hasn’t taken into account the fall in retail prices that the growing infrastructure of solar panels has helped to engender. According Melbourne University, the 4,000 MW of solar that currently influences the market could account for savings as much as $2 billion a year, which over 20 years could be over $40 billion, far more than the Grattan figures have suggested.

There are numerous other false assumption in the Grattan calculations and the Guardian reported this week that: “it adds up the costs but not all the benefits. In this case, to dismiss the lowering of wholesale electricity prices caused by the proliferation of solar PV, which, it argues, ‘does not constitute a net economic benefit to society’.”

The truth is that solar power is a developing technology and we are not completely sure of the benefits it will have in the future. One place to see this is in the evolution of battery technology that is able to effectively store the electricity produced, a problem that has held the industry back to some degree in the last few years. With the new Tesla battery and the inevitable rapid development of this type of storage technology we could see solar installations that provide power all day round and well into the night.

Most industry insiders believe that we have moved on a fair bit from this kind of corporate scaremongering provided by the Grattan Institute and that, particularly in the UK, we are more in favour of solar energy than ever before. We are likely to be heading for an energy infrastructure which is dependent to a large extent on the development of solar and the production of micro grids. The solar backers might well be able to breathe a hefty sigh of relief.



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