Dáil Éireann Debate, Wednesday - 28 June 2023
27. Deputy Ged Nash asked the Minister for the Environment, Climate and Communications how his Department arrived at the estimation (details supplied) as included in his Statement of early May 2023 when he announced the zero VAT rate on the sale of solar panels; and if he will make a statement on the matter. [31535/23]
View answerThere are many variables in estimating a payback period for investing in a Solar PV system. My statement in May was designed to show the change in payback period as a result of the VAT change. A worked example (based on a 4.5 kW system, costing on average €9,000 prior to the VAT change) is as follows :
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Assumptions |
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4.5kWp system, producing 800kWh per kWp per annum |
Electricity Tariff @ 0.32c per kWh |
80% Self Consumption |
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Calculations |
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4.5 kWp |
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3600 kWh produced p.a |
800 kWh x 4.5 per annum |
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2880 kWh self-consumed p.a |
@ 0.32c per kWh |
Saving €921.60 per annum |
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Average 4.5 kW System Cost |
Minus Grant €2,400/savings p.a |
Payback Period |
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€9,000 (pre-VAT Change) |
€6,600/€921.60 |
7.16 years |
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€8,000 (post-VAT Change) |
€5,600/€921.60 |
6.07 years |
