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 SILICON CHIP www.siliconchip.com.au Publisher & Editor-in-Chief Leo Simpson, B.Bus., FAICD Production Manager Greg Swain, B.Sc. (Hons.) Technical Editor John Clarke, B.E.(Elec.) Technical Staff Ross Tester Jim Rowe, B.A., B.Sc Nicholas Vinen Photography Ross Tester Reader Services Ann Morris Advertising Enquiries Glyn Smith Phone (02) 9939 3295 Mobile 0431 792 293 glyn<at>siliconchip.com.au Regular Contributors Brendan Akhurst David Maddison B.App.Sc. (Hons 1), PhD, Grad.Dip.Entr.Innov. Kevin Poulter Dave Thompson SILICON CHIP is published 12 times a year by Silicon Chip Publications Pty Ltd. ACN 003 205 490. ABN 49 003 205 490. All material is copyright ©. No part of this publication may be reproduced without the written consent of the publisher. Printing: Hannanprint, Warwick Farm, NSW. Distribution: Network Distribution Company. Subscription rates: $105.00 per year in Australia. For overseas rates, see our website or the subscriptions page in this issue. Editorial office: Unit 1, 234 Harbord Rd, Brookvale, NSW 2100. Postal address: PO Box 139, Collaroy Beach, NSW 2097. Phone (02) 9939 3295. E-mail: silicon<at>siliconchip.com.au ISSN 1030-2662 Recommended & maximum price only. 2  Silicon Chip Publisher’s Letter The economics of hybrid solar systems Our report on a hybrid solar system in the October 2015 issue has created a great deal of interest among our readers. People are particularly interested for a number of reasons and two of those reasons are the escalating cost of electricity and the daily service charges levied by the energy retailers. These daily service charges are usually regarded by consumers as unjustifiably high, especially since they have been increasing at a much higher rate than the actual energy tariffs. So much so that many readers have entertained thoughts of going off-grid altogether. And that brings us to the hybrid solar system described in October. Compared to any normal domestic grid-tied solar system, this is a large system indeed, with a particularly large installation of deep-cycle lead-acid batteries. Such a large battery bank is absolutely necessary if the system is to be able to cope with a period of rainy days when the output from the solar panels is likely to be severely curtailed and of course, to cope with normal power demands at night. No matter which way you look at it, the system is a credit to the owner, Geoff Woodman, who has really been a pioneer – there are not too many other domestic installations of this size in Australia and of those that have been installed, most have been by owners who are very well-heeled and not really concerned with the all-up cost. However, those who are not so well-heeled need to look very carefully at the economics of such an installation before going ahead. This is particularly the case where the proposition is to go completely off-grid because that requires an even larger and more costly battery bank. Two correspondents in this month’s Mailbag pages have been quite forensic in their analysis of the economics of Geoff Woodman’s system and if you read their letters carefully, the only logical conclusion is that the economics simply don’t add up. You can certainly question some of the assumptions in the two letters. For example, I think their assumptions about solar panel life and decline in output are overly pessimistic. However, there is no doubt that solar panel outputs do decline and more so if they are never cleaned. Nor can you expect that a bank of solar panels will never need any maintenance or repairs. Just think about how individual solar panels or their bypass diodes may fail. What’s more, the connections will almost certainly be subject to corrosion and the isolating switches or solenoids may fail or go high in contact resistance. From stories in our Serviceman’s Log pages, we already know that the grid-tied inverter is the weakest link in a typical domestic system and that is not likely to be any better in a larger hybrid system which will employ several inverters. Finally, there are the storage batteries and these definitely do have a finite service life. Lithium batteries are likely to be a lot better but they are not a mature technology yet and no-one really knows how reliable they will be in the long term. Some readers may quibble about the likely return on investment and opportunity cost. Some may not fully understand how the calculations on such an investment are made – they are similar to the calculations for principal and interest payments on a home loan but in this case you would start with a principal amount which is invested, say $50,000 at 5% after-tax, so you earn $2500 per annum. Then you deduct the cost of energy for the year, say $3000, to end up with $49,500 and then the cycle repeats each year so that your principal is gradually reduced. But that ends up being a more economic proposition than spending that money on a solar hybrid system. Ultimately, no matter how optimistic and environmentally conscious you may be, and how you may twist the assumptions about return on investment, there is no avoiding the conclusion that hybrid solar systems are simply not an economic proposition at the present time. Furthermore, those costs will need to be substantially reduced before such installations become economically attractive. Leo Simpson siliconchip.com.au