Retirees explore solar system to save money and stay warm
While household budgets are tight and electricity expensive, older citizens are exploring new ways to make ends meet.
With being stranded on a fixed income looming, fearing living costs and inflation would eat up his savings, retiree John Collie turned to the Nelson sun to pay his bills.
Collie, 70, made the move in 2014, when solar panels cost him $12,000 per panel to buy and install. Now he estimates it would cost around $9000.
He remains a convert, his enthusiasm sparking down the phone, as he talks about selling his excess power to Octopus Energy, at 17 cents per kWh. He dropped from a high user, to a low user, with all the economic benefits that brings.
‘‘Power is something I don’t even bother about. Saying that, every night I look at my account with Octopus because I like to see how much I’ve bought and sold for the day. At the moment I’m on something like $544 in credit,’’ he tells the Sunday Star-Times.
His initial motivation was for he and wife Pam to be able to live on their pensions, rather than for any environmental considerations. ‘‘I thought, we’ve got to start looking at where do we lie when I retire? Pam is a couple of years older than I am, so basically, both of us retired at the same time.
‘‘We started looking at what was costing us, where our money was going if we had to live on a pension, without looking at any superannuation we had.’’
He considered all costs, rates, water rates, insurances, cars… and power, and saw an opportunity in solar energy.
Now his excess renewable energy puts him in credit over summer, so he has cash on hand for winter bills.
Superannuation pays each half of a married couple $674.52 a fortnight, on the 17.5% tax rate.
Solar power allows saving up for a cloudy day, a dark night, and power outages caused by the likes of Cyclone Gabrielle, if you have the means to store it in a battery.
‘‘At this time of the year, while the big yellow’s in the sky we’re making coin, but there will be four-and-a-half, five months [over winter] where I will be paying the power company. We’re basically trying to live within the income from the pension.’’
To Collie, a former technical engineer, it’s a no-brainer.
‘‘People say to me, ‘what’s the payback on it?’ I use the analogy of, you’re quite happy to go out and buy a brand new car for $50,000, and you’re paying for petrol, insurance, servicing, maintenance, tyres, the whole nine yards. And after four years, you’ll sell it, and you’ll drop $20,000 on that.
‘‘Solar power, you pay once off: you buy it, it sits on your roof. Once a year my electrician comes around, checks it out, cleans the panels and that’s $200, and it’s guaranteed for 25 years.
‘‘I’m running three deep freezers, two fridges, three heat pumps. That’s added another $2000 to my account, and we are still making money on solar.
‘‘I’m in the workshop [as we speak]. We’ve just done some washing and stuff like that, and we’re still putting power down the line.’’
Many older people seem to agree, with solar panel providers and power companies reporting increased interest from pensioners in managing at least part of their household costs.
Solar panel systems offer consumers the flexibility to use selfgenerated power during the day, when it’s cheap, and avoid more expensive morning and evening high usage periods; perfect for people who tend to be home during the day.
Increasing solar power selfconsumption by storing power in batteries is on the rise.
Stored solar power can be used any time of the day or night, offering heat, light, communications and hot water when the grid goes out.
Retirees have apparently swiftly cottoned on as the costs fall and benefits rise.
Panels are getting cheaper, buyback prices higher, but selfconsumption is best; off-setting an electricity bill with solar power is more valuable than exporting power to the grid.
On top of that, banks offer incentive schemes, with ANZ’s Good Energy Home Loan, Kiwibank’s Sustainable Energy Loan and Westpac’s Warm Up Loan.
My Solar Quotes managing director Kristy Hoare says: ‘‘Most people who come to us ... are of retirement age.’’ That trend
translates to panel sellers; not only is there interest, it has translated into purchase action.
Solar panel installer Harrisons Solar marketing boss Mitchell Grant says there is a massive audience of those either in retirement or knocking on the door of retirement.
‘‘A big reason why, is power bill savings – it’s 100% a thing,’’ he says. Harrisons offers deals on the Super Gold card, the pensioner discount scheme.
‘‘We offer all those customers 20% off solar panels. This shows we’ve recognised that’s a massive part of the market for us.
‘‘[These customers] may have built up cash, and can access KiwiSaver to use the money to increase the value of their home by adding solar.’’
Future Energy director Heath Coleman says the proportion of over 65-year-old customers is growing faster than other demographics, putting it down to rapidly increasing energy costs, and an ageing grid infrastructure causing more power outages.
‘‘Going solar is great for this demographic as it reduces monthly outgoing costs whilst also providing energy independence in the event of these power outages.’’
While a payback period of 7-10 years is the rule of thumb, there are many variables. Solar systems will pay for themselves more swiftly in some regions – some homes even – than others.
It would depend on things like how sunny the location is, how much the user’s network charges and how much their retailer buys excess solar back for. Octopus Energy is the top payer, at 17 cents per kWh.
All these factors working well together, then it can make a big difference. Northland has high power prices and lots of sunshine, so is well suited.
Sustainable Electricity Association of New Zealand says the best payback would be a system correctly sized for the particular household. An oversized system costs more, exports all day and attracts only low buy-back rates.
As for selling solar power, the buy-back price ranges between 7-17 cents per kWh for exported solar power.
Octopus, which boasts 3 million customers worldwide, is the top payer, after joining the local market last year.
Chief customer officer Margaret Cooney says there is a method as to why the company pays more. ‘‘Globally supporting renewables big and small, so we wanted to give customers a great buy-back rate,’’ she says.
‘‘We know anecdotally that solar panel installers recommend us to their we’re customers because our 17 cents rate is going to get you to the point of breaking even on your investment just that little bit faster.
‘‘At the end of the day, we want Kiwis to understand that going solar is going to benefit them, as well as play a role in getting New Zealand’s grid to 100% renewable.’’
Octopus was also working on smart tech to allow customers to optimise their use. Among that was remotely optimising batteries to feed power back into the grid at peak times.
About 25,000 solar power systems have been installed in New Zealand as of last year; Parliament has one.
In Nelson, John Collie doesn’t have an electric car, and wouldn’t buy one – an outdoors type, he considers them unsuited to towing.
But Collie has persuaded his brother to join the solar system, and has daughter Toni living in a solar-powered house on the family’s Richmond section.
He offers some advice, and a warning.
‘‘You’ve got to remember that once the sun goes down, you’ve got nothing. And on a shitty cold winter’s day, it’s a shitty cold winter’s day for everybody.
‘‘You’re only producing half a kilowatt out of all those panels – we have three or four days in the winter where we just basically make a kilowatt of power for the day.’’
And the advice?
‘‘It’s never too late, it’s whether you can afford it. A lot of people don’t look at their power bill, they just get it and pay it.
‘‘They should really look at how they’re using power and the way Octopus sets everything up, you can see every hour of the day, what you used, how you used it. People have got to start rationalising it.’’
That’s advice worth considering, on a week when it was reported people were going into debt to pay for their electricity, and ASB Bank said household expenses had risen $150 a week.
‘‘At the end of the day, we want Kiwis to understand that going solar is going to benefit them, as well as play a role in getting New Zealand’s grid to 100% renewable.’’ Margaret Cooney
Octopus chief customer officer