In 2018, Greenpeace imagined a country in which half million homes had solar panels on the roof, and batteries on the walls.
The environmental lobby group called for the ‘solarisation’ of the suburbs, hoping to see its vision become reality in just 10 years.
“By supporting 500,000 New Zealand households to instal solar panels and batteries, we can tackle the existential threat of climate change, increase the resilience of our power grid, and lower energy bills for everyone,” Greenpeace said.
Three years later, with Government subsidies nowhere to be seen, fewer than one in every 100 homes has solar panels, leaving us dependent on centralised power generation, which too often burns gas and coal to keep the lights on.
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Brendan Winitana, chief executive of the Sustainable Energy Association (SEANZ), is feeling frustrated, but not gloomy.
The latest data shows a record level of solar systems being connected to the power grid, he says.
In the six months to the end of June, 2909 solar systems were installed, an average of 485 a month, though they are not all home solar arrays, with many businesses opting to cover their roofs in photovoltaic cells to power their money-making enterprises.
“Compared to same period last year with seasonal and Covid-adjusted numbers, that’s a 36 per cent increase,” Winitana says.
He says 1 in 64 buildings have solar, but it may not seem that way to the casual observer, as some remote and rural areas, and some especially-sunny parts of the country, like Nelson, have a higher solar hit-rate.
But at that rate of installation, with just over 33,700 solar systems installed, it could take 80 or more years for the country to reach Greenpeace’s half million homes.
Are memories of poor value holding homeowners back?
Solar installers believe a complicated range of factors, including falling home-ownership rates and wrong-headed myths and deliberate attempts to stymie it, are preventing the acceleration of solar’s rise in residential streets.
Phil Harrison from Harrisons, the country’s largest residential solar installer, believes many homeowners were held back by long-payback times.
“If you go back even five years, the main reason was the cost of solar,” says Harrison.
“It didn’t stack up as an option,” he says.
Even just three years ago, Consumer projected decades-long payback times for solar, prompting Winitana to commission a report analysing the solar returns of 21homes scattered throughout the country.
“Real performance data from these solar power systems has shown in every scenario the return on investment figure (the lowest being 5.42 per cent return on investment) was higher than the current average bank interest rates of 2.5 per cent,” SEANZ reported.
Since then power prices for homeowners have risen, and term deposit rates fallen.
ANZ was paying just 1.4 per cent for a one-year $10,000 term deposit.
“Over the last seven years, the price of solar has dropped around 75-80 per cent. It’s a significant price drop,” Winitana says.
He thinks many homeowners may still have their heads stuck in the past.
People may also not realise that solar has become a better technology with the good panels now guaranteed for 20-25 years.
Boosting capital values
Another thing that may be holding the industry back is that there’s little research into whether solar gives homeowners a capital value boost to their homes.
Winitana says the evidence from overseas, including our near-neighbour Australia, points to buyers being willing to pay more for homes with solar.
But there has been no convincing study in New Zealand, though last year, based on a sample set of houses using a 3KW Harrison solar power system, Homes.co.nz found that the properties made 4.4 per cent or $35,000 more than other comparable properties nearby.
It was a desktop study, and could not control for other factors. It could be that people who take the trouble to instal solar are better, more diligent home-owners, keeping them better maintained, and better insulated.
Andrew Eagles, chief executive of the Green Building Council, says international evidence does suggest buyers are willing to pay more for warm, energy-efficient homes.
Recent data from Nationwide building society in the UK, for example, suggests a 1.7 per cent premium for higher energy efficient homes compared to the average.
But, he asks, if solar give such a boost to prices, why isn’t there a solar array on every new Fletcher Building house?
Fletcher Building spokeswoman Kate Barlow says: “Solar panels are being trialled on a small number of homes in our Waiata Shores community next year.
“However we aren’t currently installing them on new Fletcher Living homes across other sites as our buyers aren’t indicating having them would influence their purchase decision.
“That said, we always keep an eye on changes in customer’s preferences as well as improvements in the technology or economic outcomes for customers,” she says.
The insulation bugbear
Some homeowners may have looked at solar, but found a better return for their money on other upgrades to their homes.
Eagles says solar wouldn’t be dollar-for-dollar as good an option for many homeowners as just insulating their homes better.
“On almost all indicators, New Zealand is significantly behind on just building better homes,” Eagles says.
“We have these drafty old homes. So long as people have done that first, then great .”
“If people are going to spend $10-$20,000, we would suggest they might look to do things like improving insulation, and getting the ventilation right.”
Otherwise, he said: “They might just be generating energy they go on to waste.”
Each house’s solar potential varies
Households’ solar potential and power use vary hugely, says Harrison, but with more people doing more work from home, power-use by households when the sun is shining is rising.
The financial payback of a solar system for a home depends on the system installed, the price paid, the orientation and sun-exposure of the home, power prices, and the power-use of the homeowner.
Online calculators may give people an indication of whether solar could work for them, but to get a home-specific estimate, people have to get a professional in.
Solar works best when homeowners use the power they generate, as the feed-in tariffs power companies pay to buy power from homeowners are low, says Harrison.
Homes from which businesses are run can have much-reduced payback times, and with more people working more from home, there’s the potential for a step-change in the home economics of solar, Harrison believes.
Harrisons installed solar at the Canterbury lifestyle block home of former All Blacks’ coach Sir Steve Hansen.
“He had really strong financial reasons because he has a small farm with irrigation working, and massive power bills. His house was perfect for solar,” Harrison says.
Hansen also had a large shed with a well-oriented roof open to the clear Canterbury skies.
In a bid to change perceptions, Harrisons struck a deal with real estate marketing website Homes.co.nz allowing people to get “solar estimates” for the dollar value of solar power their homes could provide each year.
The Zero Energy house
Engineer Shay Brazier’s Zero Energy house in Auckland’s Point Chevalier may be the most famous solar house in the country.
Brazier, who was involved in the building of the Foodstuff’s solar array, believes many homeowners had not been exposed to the possibilities of solar, but he also believes “misinformation” has held some homeowners back.
He also thinks low levels of financial and technical literacy prevent many homeowners looking at solar as an option.
But he’s optimistic.
“I do think it’s part of a portfolio of things that is going to contribute to people having lower power bills in the future, and more comfortable homes, and better health outcomes,” he says. “Onsite solar generation is going to be a big part of how we do that.”
The Zero Energy home is built with very high levels of insulation, and is oriented and designed to capture heat from the sun passively, and hold onto it, long into the evening.
“We have never had to heat it,” Brazier says.
If all New Zealand’s homes were so well-built, there would be no power crisis, he says.
It’s about the batteries
The Zero Energy House does have a battery to store power, but batteries cost a lot of money, so much that the economics of pairing battery with solar are yet to make sense for most homeowners.
Batteries one day look likely to help solve the mismatch between when homeowners want to use power in the evenings, and when the sun shines.
“There’s definitely a very interesting model when the costs get down more,” says Brazier.
“It’s not going to be 10 years. It’s going to be less than that,” Brazier says. “We are at the start of the curve right now.”
Harrison agrees, but says the company is having no trouble selling attractive Tesla Power Walls.
“Some people just want a Tesla Power Wall,” he says. “A battery isn’t bought for a financial benefit.”
This is like many things people buy for their homes, like spa pools, to improve their lifestyles, or expensive cars, he says.
“Some people aren’t doing it for a financial return. They are buying it for self-reliance,” he says.
The recent power black-outs on August 9, which plunged many homes into darkness during one of the coldest nights of the year, haven’t hurt interest in solar and batteries, Harrison says.
It could be that when battery prices fall far enough, Greenpeace may see an acceleration towards its dream of 500,000 solar-outfitted homes.