Your Solar Quote Is Only As Good As The Numbers Behind It

13 Jul

A solar company can give you a beautifully designed proposal, a fancy graph and a very precise-looking payback period.

And it can still be wrong.

Not because they're lying.

Not necessarily because they've made a mistake.

Sometimes it's simply because the numbers they've put into the modelling software don't actually reflect how you use electricity.

And that's a much bigger problem than it sounds.

Because when you're spending $20,000, $30,000 or even $40,000 on solar, the difference between a good model and a lazy one can be thousands of dollars over the life of the system.

Solar software isn't magic

Most reputable solar companies use modelling software to predict how much electricity your system will generate, how much you'll use, how much you'll export and what that might do to your power bill.

Great.

But here's the catch:

The software is only as good as the numbers you put into it.

If you give it accurate information, it can produce a very useful model.

If you feed it generic assumptions, you get a very expensive guess.

At Equity Solar Brokers, one of the first things we do is take your actual electricity usage and put it into the modelling software month by month.

Not just:

"This house uses about 12,000 kWh a year."

We want to know when you're using it.

Because 12,000 kWh used evenly throughout the year is a very different solar proposition from 12,000 kWh with huge winter usage and relatively little consumption during the day.

And that's before we even get to your electricity tariff.

Your power bill contains more information than you think

Your power bill isn't just there to tell us how much money you've given the electricity company this month.

It tells us how much electricity you're using.

And, depending on your retailer and power rates, it can tell us when you're using it.

That matters.

A solar system produces most of its electricity during the day.

You probably use a lot of your electricity at other times.

So the important question isn't simply:

"How much electricity do you use?"

It's:

"How much electricity do you use, and when do you use it?"

If you're out at work all day and everyone gets home at 5pm, your solar system is going to behave very differently from a household with someone home all day.

If you have a house & income with an Airbnb that is occupied more heavily on certain days, that matters too.

If you have a hot water cylinder, EV, pool pump or other large loads that can be shifted into the middle of the day, that matters.

The annual kWh figure doesn't tell us any of that.

Then there's the electricity price

This is where things get really interesting.

Your solar savings aren't calculated against some universal "electricity price".

Your electricity company charges you a particular rate.

You might have:

A peak rate
An off-peak rate
A controlled rate
Different weekend pricing
A daily charge
A particular solar buyback rate

And those rates can vary considerably between retailers.

So if someone models your solar system using a generic electricity price, they're making an assumption about one of the biggest variables in your return.

That's not necessarily malicious.

It's just lazy. And probably misleading.

Buyback rates matter too

Solar doesn't only save you money when you use it.

If your panels are producing more electricity than your house needs, you can export the surplus to the grid and your electricity retailer pays you for it.

That's another part of the calculation.

And it's important because every unit of solar you export is worth something.

If your retailer pays you 16 cents for that electricity, but you would otherwise have used it yourself to avoid buying electricity at 35 cents, those two situations aren't financially equivalent.

This is one of the reasons batteries can be surprisingly complicated to model.

You aren't simply swapping 35c electricity for free electricity.

You're often deciding between:

Use the solar now

Store it and use it later

Sell it to the grid.

The modelling needs to understand all three.

The battery calculation is where things can get really weird

Let's say your electricity costs you around 35 cents per kWh.

And your retailer would have paid you 19 cents for solar you exported.

If you put that solar into a battery instead, you aren't saving 33 cents.

You're giving up the 19 cents you could have earned by exporting it.

So the incremental value of that stored electricity is roughly:

33c − 19c = 14c per kWh.

That's why a battery can add a lot of functionality to a solar system without necessarily adding a huge amount of financial return.

And it's exactly why we think batteries should be modelled properly rather than simply added to a proposal because "everyone wants a battery".

Sometimes the numbers stack up.

Sometimes they don't.

Sometimes you buy the battery because you want backup power, energy independence and the experience of having your house keep running when the grid goes down.

That's completely valid.

But it's a different argument from saying:

"The battery will massively improve your solar ROI."

And then there's winter

This is another one that gets overlooked.

You can have a solar system that generates an enormous amount of electricity over a year and still have some fairly chunky winter power bills.

Why?

Because solar generation isn't evenly distributed throughout the year.

You produce much more in summer than you do in winter.

So when someone tells you:

"This system will generate 100% of your annual electricity usage."

That sounds fantastic.

But it doesn't necessarily mean your power bill will be 100% eliminated.

You could generate 100% of your annual consumption and still end up with 75% of the winter bill you had before solar.

So that's why we like looking at the month-by-month numbers.

If your objective is to dramatically reduce your winter bills, we need to know what the system is actually doing in June, July and August.

Not just what it does in January.

The scary part?

Two solar companies can model the same house and produce very different answers.

Same roof.

Same number of panels.

Same inverter.

Same battery.

Different assumptions.

And suddenly you've got:

Company A: "You'll save $3,200 a year."

Company B: "You'll save $4,100 a year."

Company C: "Your payback is 5.8 years."

Company D: "Your payback is 7.2 years."

Now you're sitting there thinking:

"Which one of these bloody things is right?"

And that's exactly the problem.

You're not comparing solar systems anymore.

You're comparing different assumptions disguised as comparable quotes.

This is why comparing solar quotes is so bloody difficult

Most homeowners think getting three quotes means they'll be able to compare three prices.

Unfortunately, that's not really how solar works.

One company might quote 18 panels.

Another might quote 24.

One might include a battery.

Another might not.

One might use a 5 kW inverter.

Another might use 10 kW.

One might assume you'll export a lot of electricity.

Another might assume you'll consume most of it.

One might use your actual electricity tariff.

Another might use a generic rate.

And all of them can confidently tell you:

"This is the best system for your home."

So you've got three proposals based on entirely different ideas.

Good luck.

We're solar brokers.

Our job isn't to sell you a particular panel, inverter or battery.

We look at what you're actually trying to achieve, build the system around that, and then get solar companies to quote against the same brief.

That means we're interested in the numbers before we're interested in the sales pitch.

We want to know:

What are you using?

When are you using it?

What are you paying for electricity?

What are you being paid for exports?

What do you actually want solar to achieve?

Then we can model the system properly.

And when the quotes come back, we can compare them on an apples-to-apples basis.

Because if one company is quoting you 20 panels and another is quoting you 25, the question isn't:

"Who's cheaper?"

It's:

"Why are they recommending different systems?"

That's the question worth answering.

Don't be impressed by a very precise number

A solar proposal might tell you that you'll save:

$3,847 per year

and reach payback in:

6.4 years.

Very impressive.

Very precise.

But ask yourself:

Where did those numbers come from?

Because the difference between a model based on your actual electricity usage, power rates, specific export rates and actual household behaviour...

...and one based on generic assumptions...

...can be enormous.

The software doesn't know your house.

We have to tell it. Solar companies should be telling it. It's a 10 minute exercise, at best. No excuses.

And that's why, before you get too excited about the shiny graphs and impressive payback period, it's worth taking a closer look at the boring numbers underneath.

Because when you're spending tens of thousands of dollars on solar, the boring numbers are the important bit.

Oh an by the way, AI is great. But humans are better.

Want someone to make sense of the numbers?

That's basically what we do.

You give us your power bill and site photos.

We work out what you're actually trying to achieve.

We design the system around your property and usage.

Then we keep you 100% anonymous and procure apples to apples quotes.

You miss out on weeks of sales calls and all the stress and confusion that comes with comparing quotes that don't match.

Collaborate with Equity Solar Brokers to design the ideal solar system, and then get quotes that are a breeze to compare.

Rowan Ellis