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Here’s a fun fact – within just one decade, the number of solar power systems on Kiwi rooftops grew from around 5,500 to over 62,000! This is a whopping 1000% increase, clearly suggesting that home solar power systems have gone from ‘the next big thing’ to the ‘current big thing’.
Solar power systems can be broadly categorised as grid-connected or off-grid, and among these, the grid-connected solar power system emerges as both economical and uncomplicated. Also called a grid-tied solar system, this setup allows you to use both solar and grid energy in a flexible, bidirectional manner.
The cost of a grid-connected solar power system can range from $8,000 to $16,000 NZD, covering full installation.
At its core, a grid-connected solar power system is made of three main things:
As the name suggests, a grid-connected system is linked to the electrical grid (the poles and wires outside the home). This interconnection facilitates two functions:
Put simply, interconnecting your system with the grid offers excellent flexibility, often eliminating the need for expensive battery storage to make your excess solar energy usable during the night.
Generation: When sunlight hits solar photovoltaic (PV) panels, electricity (or solar energy) is produced. This happens when light particles, called photons, strike the solar cells and knock off loose electrons. These electrons then flow through a circuit, resulting in an electric current.
Conversion: The electricity generated by the multiple solar panels is combined and runs through an inverter. The inverter turns the power from direct current (DC) into alternating current (AC), making it compatible with the electronic appliances in your home or office.
Self-Consumption: Your home appliances that are operational during the hours of solar power generation will consume the solar energy and save you money on grid power. Any solar power that is used right away in the house is called self-consumption, implying that the energy was not sent away into the grid.
Export: If your home does not use up all the generated solar energy during the day, the power gets sent to the grid via a bidirectional meter, which measures power flow in both directions. Electricity retailers apply credits in exchange for energy produced. During the night, when solar power systems are not producing energy, power can be drawn from the grid. This can be paid for with credits earned.
The biggest benefit of installing solar is a significant reduction in your electric bills. Despite the equipment and installation cost, sunlight is completely free, meaning that once your system is paid off, you enjoy free power for multiple decades.
How much reduction you’ll see on your energy bills depends on several variables. Let’s take the example of an average-sized solar power system on a typical home.
Most solar power systems in New Zealand have a payback period of 7-8 years. Considering the average solar panel lifespan of around 30 years, you can expect virtually free power for well over two decades. If you are paying about $200 in electricity bills each month, this amounts to nearly $40,000 in savings, even after taking the upfront cost of solar into account.
If you are interested in finding out how much going solar can save you, use our free solar calculator for a tailored estimate of potential savings on your electricity bills.
The key factors that decide your savings with a solar power system are:
Key determinants of solar savings include:
Over the past 15 years, electricity prices have consistently surged by an average annual rate of 3%.
By installing a solar power system, you proactively lock in your power costs for years ahead. By investing upfront in this technology, you establish a shield against future price hikes.
While a grid-connected solar power system may still involve some grid-bought electricity, a significant chunk of your power supply will come from your solar panels, strengthening your defence against rapidly rising energy expenses.
Despite New Zealand's reliance on renewable energy sources for most of its grid power supply, a notable 10-20% still stems from fossil fuel generators, like the Huntly Power Station.
Solar power stands out as an exemplar of renewable energy, drawing from the sun's ceaseless and abundant energy reserves, which remain inexhaustible and non-depleting.
Unlike finite fossil fuels, solar power operates without emitting pollutants or greenhouse gases. Its low environmental footprint, the potential for localised and decentralised generation, and its role in enhancing energy resilience establish it as a crucial catalyst for reducing carbon footprints and confronting the pressing issue of climate change.
Integrating a solar power system onto your rooftop increases your personal consumption of renewable energy and sends more renewable energy out to the grid.
More interestingly, all energy on the Earth comes from the Sun. Whether it’s plants, fossils, or wind power, the primary source for everything is the Sun. It therefore makes sense to use all this power directly instead of going to the trouble of distant power stations and complicated transmission and distribution systems.
Using The Grid As Back Up
During times when your solar panels aren't generating enough electricity (e.g., at night), you can still draw electricity from the grid as usual. This eliminates the need for energy storage systems like solar batteries in a basic grid-tied solar system, as the grid serves as a reliable backup source.
Enhancing Grid-Connected Systems with Battery Integration
Although grid-connected systems are quite self-sufficient on their own, you may want to consider adding battery storage for even greater energy independence.
Many New Zealanders are adopting a two-step approach, beginning with the installation of a solar power system and subsequently integrating batteries when they have the budget for it, given that battery costs remain substantial. These batteries, however, emerge as an exceptionally dependable electricity source during blackouts.
For those with an established solar power setup, the addition of an AC-coupled battery is recommended due to its simplified configuration in comparison to a DC-coupled battery. This approach allows the existing solar power system to remain untouched while introducing the battery configuration as an extension.
The best way to maximise your return on investment with a grid-connected system is by utilising as much generated solar power as possible.
Using self-generated solar power is worth-while; why waste money on expensive grid power? (typically around 30 cents per kWh). Immediately taking advantage of solar power is the best option for return on investment. Using solar power directly is known as solar power self-consumption, you can find more information on: solar power self-consumption.
Your bill will have separate line items on it each month. On the first line is the amount of power used, the price per unit (cents/kWh), and the total cost of power used (imported power).
The second line shows the amount of solar power you export to the grid, the price per unit the energy retailer pays you for it, and the total credit amount received from exporting power. This credited amount will be subtracted from the total cost of power used.
Find out what different energy retailers pay for: exported solar power here.
Standard solar panels have at least a dozen silicon squares within the frame (solar cells). Solar cells convert sunlight (photons) into an electrical current.
Silicon is a semiconductor - it's able to absorb a percentage of the photons emitted by the sun as they hit the solar cells. As the solar cells are bombarded with photons, the electrons are knocked loose, allowing them to flow freely.
The solar cells have an electric field that allows loose electrons to flow in one direction. Metal contacts (both on top and the bottom of solar cells) carry the current through a solar cable to the solar inverter. The inverter converts DC electricity generated by the solar panels into usable, AC electricity. This is similar in nature to the grid power that flows into your home, allowing you to use it however you choose!!
Check out our Components page for more information about solar panels and other solar system parts, components and essentials.
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