Solar panels less lucrative, 'but still provide 17 years of free power'

Sunny summers were always extra good news for solar panel owners. In addition to offsetting their own power consumption, they could sell the surplus power to the energy supplier.

That's changing now. More and more power companies are charging fees for feeding power back, to the dismay of customers with solar panels. But: the panels remain quite lucrative.

Because panels have become so cheap, the balancing scheme is actually no longer necessary.Mathijs Bouman, economist

To motivate people to take solar panels, the government once introduced the net-metering scheme. This means that solar panel owners can deduct the electricity they supply to the grid from the electricity they consume. In this way, a roof full of solar panels was often quickly earned back.

Power companies are responsible for the scheme. In summer, they get a lot of power delivered back to them, but then they earn little from it. In winter, they have to supply a lot of power for free to solar panel owners.

The companies are allowed to decide how to offset those extra costs. Previously, they did so by making all customers contribute to the costs. People without solar panels, who often have less to spend anyway, paid for people with solar panels. "More and more energy companies are saying: that's unfair," says energy expert Isabelle van der Ende of Milieu Centraal.

Power grid unnecessarily burdened

Economist Mathijs Bouman speaks of "oversubsidization." "The scheme was primarily intended to develop the solar panel market. But because panels have become so cheap, this subsidy is actually no longer needed."

Another disadvantage of net-metering: solar panel owners have no financial incentive to use a lot of power when there is a lot of sun as well. "The power grid is therefore unnecessarily burdened," Bouman said.

The government therefore wanted to phase out the balancing rules starting in 2025, but the Senate stopped that. This leaves power companies with the cost of balancing. To ensure that customers without solar panels no longer have to pay for this, the more and more energy companies feed-in charges. Costs and rules vary quite a bit from one power company to another. "That's quite confusing," says Van der Ende.

At the same time, Van der Ende emphasizes that solar panels are still very lucrative. Milieu Centraal calculated that people earn back their solar panels with feed-in costs in about eight years. Without feed-in costs that was five years. "Now that difference is pretty big, but it doesn't really say that much. Because those panels are on your roof for 25 years, so you still have seventeen years of free electricity."

"Moreover, you are not dependent on an erratic energy market. You generate your own green power, which is good for the climate and your wallet."

Home Battery

Solar panels would be even more profitable if all the energy generated could be used by the owners. Large batteries to store excess solar power are expensive for now, but feed-in costs are a additional financial incentive. Bouman: "Home batteries become more profitable as feed-in costs increase."

Regardless, solar panels remain a good investment, says Van den Ende. People who already have panels do pay a few dozen more each month than they assumed when they bought them. Unfair, some think. Van der Ende: "It is advisable to look extra carefully at which energy company you are with, because the differences are quite large."

Source:, May 7, 2024