From James Edmondson
In calculating the payback times for investment in alternative energy systems (27 March, p 46), Ed Douglas used an erroneous assumption. He stated, for example, that payback for the photovoltaic system costing £11,000 would take 55 years, so that you recoup £200 per year. Such calculations assume that a single rate of inflation applies uniformly to everything – but this is not necessarily the case.
Say I have £11,000. I could put the money in a savings account and earn 3 per cent interest, but I don’t think I can trust the vagaries of the stock market and I am also worried about escalating energy costs. I make a guess that electricity costs will begin to rise faster than they do today, inflating at 12 per cent per year as society is weaned off oil. If I invest my money in a solar power system under these circumstances, then in only 24 years I will have recovered my capital outlay and the interest I would have earned from the savings account.
That is still a long time, but far better than 55 years. The investment would also provide benefits such as a measure of security against future energy crises. There are only two questions to answer before I go ahead. First, photovoltaic costs are falling, so when is the best time to buy the panels? And what is the useful life of the panels?
From John Kirby
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I was concerned that Ed Douglas’s article on ways to make homes more energy-efficient (27 March, p 46) did not refer to the “feed-in-tariffs” – the price homeowners receive for renewably generated electricity they sell to the grid – that apply in some countries, including the UK. As these will affect how long it takes to recoup the installation costs of a renewable system, it would have been nice if they could have been included in the payback times in the diagram showing ways of making your house eco-friendly.
Nottingham, UK
Ilchester, Somerset, UK
