Is Solar Power A Bright Investment?

It costs around £8,500 to install solar cells on your roof, but the feed in tariff could give you a return of up to £37,000.

If the government offered to pay you £1,000 a year for the next 25 years, in return for an up-front investment of £8,500, you’d snap it up in a second. Well, that’s pretty much the deal on offer this week after the government revealed what it will pay those who install electricity generating solar panels – in and around their homes – through the “Feed-in Tariffs” (FITs).

After years of campaigning by environmental groups the government has agreed to reward households and businesses installing electricity-generating measures with enough of a return to make it a serious financial, as well as an environmental, investment. If you’ve got the money (which is a big “if”) and, crucially, a sunny, south-facing roof, you can earn a 7%-12% tax-free return, an income that will rise in line with inflation. At the same time, you get to do more than your fair share in reducing the UK’s carbon­ emissions.