Opinion by Teresa Settas, Marketing Director of the One Energy Group
South Africans are reeling from a sudden return to stage 6 load shedding in one of the coldest months of the year, with warnings that things are going to get much worse, while also facing massive increases in electricity tariffs that came into effect 1 July 2023.
For at least the medium to long-term, we won’t have a reliable electricity supply and will continue to be held ransom at home and at work with load shedding and infrastructure collapses that threaten our safety, security, productivity and sustainability. Given the state of our grid and lack of transmission capacity, load shedding is not going away any time soon – this is an indisputable fact. Now more than ever, you need to take a considered view of how to get yourself as close to grid independence as possible, for the long term.
For many homeowners though, the initial capital outlay of financing a solar PV system upfront is not manageable. The many rental options that have sprung onto the market promise the world, while the fine print leaves you cold with hefty initiation fees and annual escalations, never-ending rental terms, hefty penalties for early cancellations and are simply not financially sound.
You can, however, finance your solar PV system for your home, in the same way that you finance your car or other asset with trusted financial services providers, taking full ownership of your system after the loan is repaid. The best part is that with a 20+ year lifespan on your system, you’ll have an incredible solar asset that returns many years of great investment returns and energy security.
One Energy is a Nedbank-approved solar supplier, which means that you can apply for finance with MFC, a division of Nedbank, for your residential solar solution. You also have the peace of mind of knowing that you are working with a solar partner that has been thoroughly vetted by Nedbank and adheres to the highest standards of quality installation, tier 1 products, workmanship and after-sales support.
Here are some of the top reasons to consider financing your solar PV system:
- Cost Savings: By installing a solar PV system, you can generate your own electricity, which can significantly reduce your monthly utility bills. The savings on electricity costs can help offset the financing expenses and lead to long-term financial gains.
- Return on Investment (ROI): Investing in solar power can provide a solid return on investment. While the upfront costs may seem significant, the long-term savings on electricity bills and potential incentives such as tax credits and rebates can help you recover your investment and even generate positive returns in the future.
- Energy Independence: With a solar PV system, you become less reliant on an unreliable grid. Generating your own clean energy allows you to gain energy independence and the power of self-determination. No more load shedding, no more power outages, no more lost work time. You also protect yourself from future increases in electricity prices, providing stability and control over your energy expenses. Considering the massive 18%+ price increase that most consumers are paying as of 1 July, with more to follow, this is an enormous year-on-year cost-saving.
- Increased Property Value: Installing a solar PV system can increase the value of your property. Many homebuyers today prioritise energy-efficient features such as solar PV as they recognise the long-term financial benefits and environmental advantages. This means that financing your solar system could potentially yield a higher resale value when selling your home, and if you’re renting the property out, a higher rental income and tenant quality.
- Low Maintenance Costs: Solar PV systems generally require minimal maintenance. They have no moving parts and are designed to withstand various weather conditions. As a result, ongoing maintenance costs are typically low, ensuring that you can enjoy the benefits of solar power without significant additional expenses.
- Financing Options: As One Energy is a Nedbank-approved solar supplier, all the necessary legal agreements and processes are already in place to ensure that you are protected and assured of the highest quality and service standards. You can apply for finance over a period of up to 72 months at a competitive interest rate with MFC, a division of Nedbank.
- Shorter Payback Periods: Advances in solar technology and decreasing installation costs have led to shorter payback periods for solar PV systems. With financing, you can start benefiting from your solar investment much sooner and recoup your costs in a relatively short period of time. This is even more pertinent now given the large annual electricity increases of 18%+ over the next few years.
Option 1: Home using 25kW per day
For this exercise, we worked on a household using 25Wh per day – an electricity bill of R2630 per month, which is around 750kWh usage per month at a tariff of R3,51 per kWh (effective 1 July with the latest tariff increase). The system specification and cost look like this:
- 5kW Sunsynk Inverter
- 10.8kWh li-Ion batteries
- 4.3kW solar panel array
- This size system will take the household to around 90% off grid, supplying around 22kWh per day.
- Cost fully installed with all materials, DB split, COC and PV Greencard: R181 000
- Based on prime interest rate, with a finance term of 72 months with no annual escalation, your monthly repayment cost is going to be R3800/pm. (Figures may vary based on your credit rating and interest rates applied)
- Based on a very conservative escalation of 5% in electricity tariffs from year 3, your cumulative savings on electricity costs will be R387 000 after 10 years and R1 021 000 after 20 years – this is a savings multiple of 5,6 on your original investment of R181 000.
Option 2: Home using 34kW per day
For this exercise, we worked on a household using 34kWh per day – an electricity bill of R3560 per month, which is around 1015kWh usage per month at a tariff of R3,51 per kWh (effective 1 July with the latest tariff increase). The system specification and cost look like this:
- 8kW Sunsynk Inverter
- 16.2kWh li-Ion batteries
- 6.48kW solar panel array
- This size system will take the household to around 90% off grid, supplying around 30kWh per day.
- Cost fully installed with all materials, DB split, COC and PV Greencard: R255 000
- Based on prime interest rate, with a finance term of 72 months with no annual escalation, your monthly repayment cost is going to be R5400/pm. (Figures may vary based on your credit rating and interest rates applied)
- Based on a very conservative escalation of 5% in electricity tariffs from year 3, your cumulative savings on electricity costs will be R350 000 after 10 years and R920 000 after 20 years – this is a savings multiple of 4,2 on your original investment of R255 000.
In both instances, your system will be fully paid off in six years and you will own it, and for the rest of the 20+ years of your system lifespan, you will be generating your electricity for free, with only a 10% reliance on grid electricity.
It’s also worth pointing out that a significant portion of the monthly repayment on your bank loan is covered by what you would be paying on electricity costs anyway (for no benefit at all). The key benefit is that you are now redirecting your electricity spend – a pure consumption cost – to acquiring a solar asset that will continue to generate savings and energy independence for many years after the loan is settled. And you get to hedge your electricity costs for the lifespan of your system.
One Energy is a Nedbank-approved solar supplier
Get in touch with One Energy to have an initial discussion and schedule a site assessment and proposal for your specific requirements.
Here’s how it works:
- Contact One Energy for a needs analysis and quote.
- One Energy will contact you to arrange for a needs analysis and provide you with a proposal and quote for your specific needs.
- Once you have your quotation, apply for finance over a period of up to 72 months at a competitive interest rate with MFC, a division of Nedbank. Click here to submit your application.
- Once approved and financed, One Energy will arrange for your energy solution to be installed.
- Enjoy always on power and a drastic reduction in your monthly electricity bill.
Start your journey to getting off the grid step-by-step today with One Energy and solar asset finance with MFC.
One Energy is a multiple award-winning and market leading solar energy franchise established in 2011 with a national footprint. We have completed over 13 500+ perfect installations as at the end of 2022. Our ethos of perfect installations backed by quality work, service and products means that every one of our clients is a contactable reference.