What is a 5kW Solar System?

A 5kW solar system is a large system that should be suitable for most homes in Australia in offsetting energy usage.

solar system 5kW

If your home is suitable for a 5kW system, you’ll get the full benefit of this technology that converts the sun’s rays into free energy for your home.

What is the Size of a 5kW Solar System?

A 5kW solar system is a minimum size that will allow the addition of batteries at some point in the future. The system uses 250W solar panels and it requires 20 of the 1.6m x 1m units to cover at least 32m² of roof space.

The configuration can generate the electricity to charge batteries even when it’s not that sunny.

If you have a system that is smaller than 5kW, you may need to consider increasing the number of panels on your roof.

Estimating Capacity to Generate Power

A 5kW solar system can generate more power than the average Australian home uses in a day.

Most homes use about 16kWh per day and the system generates approximately 20kWh.

However, installing a 5kW solar system does not automatically equate to a zero expense bill for electricity. The use of power in most Aussie homes occurs when the sun is not shining on the panels.

Calculating The Profits

It’s easy to assume that a system that can generate energy can make an electric bill disappear, but it is not that simple.

While electricity companies may pay you for the extra power that your system produces, it’s not at the same rate that you pay to buy their service.

Most states allow them to pay you a pittance of 8c per kilowatt-hour for the exported electricity that you sell to them. At 30c per kilowatt-hour, the rate that they charge you to buy it back is almost four times as much.

The Solar Payback Arrangement

These scenarios offer three types of energy use and payback that help explain how the payback system works.

  • In the unlikely situation that allows a homeowner to use all of the electricity that a 5kW system generates, the savings from energy expense offsets may equal as much as $2,100 in the first year. Over a 20-year period, the savings increase to $67,000 with the inclusion of an inflation rate on electricity of 5 percent.
  • An alternative scenario and one that is more likely to occur presents the option to export half of the electricity. The savings in the first year may amount to approximately $1,400.
  • A decision to export all of the electricity may result in a savings of $700 in the first year.

In case the calculations do not seem to make sense, it means that you understand the situation precisely. You can find out more about the way the payback system works here.

In fact, a solar calculator can let you adjust the numbers any way that you choose to find how they affect payback.

How much does a 5kW Solar System Cost?

The cost of a new system without a small-scale technology certificate (STC) is about $10,000. The solar rebate from the certificate reduces the price significantly so that your out of pocket expense is about $6,500.

Calculating Return on Investment

You can expect your system to pay you back in less than five years if you do not export the energy. However, cheap financing can let you achieve a positive cash flow from the first day that you use the system.

Funding can provide monthly energy savings that amount to more than the loan payments. With the solar calculators, you can see a visual display in green for positive cash flow or red for negative, but you need to input data that applies to your situation.

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