How accurate are solar savings quotes

Installers give homeowners quotes with huge savings numbers. Some can be accurate others are used as a sales tactic. We look at the actual consumption of one home and how much they would really save.

How accurate are the solar savings estimates that every homeowner gets in their solar quote?

Recently, a newsletter reader sent me a quote they received from a solar installer, and he wanted help analysing how accurate it was.

Let's take a look.

This homeowner was told he'd save $450 more per year than he probably would

The software that most solar installers use to create quotes has a very basic method for uploading energy history and information. They do allow installers to upload complex csv files called NEM12 files, but very rarely does a homeowner have access to these files, I've yet to see it happen.

Far more frequently, the installer might upload one or two energy bills from the home, or they enter some basic energy details manually. Either way, both of these popular techniques hardly scratches the surface of what is needed to really get the full picture of a home's energy consumption.

Recently, one newsletter subscriber was quoted that with a standard 6.6 kW system facing north and west, he'd save $1275 a year, seen above. But our estimates show that the savings will be more like $820.

The difference is that we looked at a full year of the home's energy consumption history, not just one single bill, which allowed us to dig far deeper into the actual patterns of consumption within the home.

Also, as a side note, we did this within seconds rather than waiting weeks for the energy provider to email us the homeowner's data in a complex CSV file.

We used 15-minute interval data for every hour, day, week, and month of the year to create a full picture of the home’s energy consumption.

The end result means the original quote this homeowner received overestimated their solar savings by around 40%.

Uploading a bill to get a solar estimate is a game of averages

Calculations for solar savings based on simple energy bills inherently won’t work for everyone. The calculations that are used make large assumptions to place the home within an average consumption pattern profile based on basic energy bill information.

If we think about the actual information contained in an energy bill, it should be more apparent why the bill isn’t going to provide the context needed to make an accurate solar savings estimate.

The bill holds only two key ingredients for making an accurate solar estimate, but it's missing a critical third ingredient.

The first ingredient is the amount of money that is paid for each unit of energy we use at home. This is normally somewhere between 15¢ to 50¢ per kilowatt hour and can be found on any energy bill.

The second ingredient is the total amount of energy used in the home over a given time period. Which is needed to calculate the total cost of your energy... but even this part of the bill comes with its caveats. For example, one time period, summer, isn't indicative of another time period, winter!

The missing key third ingredient is the time of day when energy is consumed in the home. On average, homes consume more energy in the evening from around 5pm to 10pm. But this isn’t always the case. Many homes consume energy throughout the day at varied rates.

Declining solar feed-in tariff credits are causing homeowners to be more cautious with solar sizing

If a solar estimate doesn't take into account what time of day the energy in the home is being consumed, then it can’t tell us how much of that consumption will be offset by the new solar system.

The solar estimate simply assumes that a certain amount of your consumption can be offset by the incoming solar system. But the quote is only an approximation.

Also, previously, solar estimates were based on the idea that feed-in tariffs were so generous you could earn a whole heap of credits that would boost the savings value of your system.

But now, as credits dry up and, in some cases, are starting to go negative, the estimates and the savings calculations need to be more accurate.

Using energy consumption patterns to estimate solar savings

By signing up to SolvingZero you can link the consumption history of your home from your smart meter to your own personal dashboard. From there, we can use that consumption history to figure out if your home had a solar system, how much money it would have saved.

We then use the same solar historical radiation data that all the installer software companies use. It was created and calculated by the National Renewable Energy Laboratory based out of the US, which is able to use the historical weather reports of every major weather station in Australia.

If that sounds interesting, then head over to SolvingZero and try creating your own dashboard to see what your potential solar savings could be.