Is solar a good investment in Spain?
It’s a question many people ask. While stock markets are volatile and inflation never ceases, solar panels are a risk-free solution to reducing expenses. 
But do the maths really add up?
According to solar panel installer Marblanc Solar, one client is on track for a 17.7% return on investment (ROI) in the first year of their solar installation. 
In this article, they’ve told the Olive Press how it all works.
You’ll learn:
If you want to see your own ROI calculations, Marblanc Solar offers a Free Solar Survey. You can request yours here.
Otherwise, let’s dive in!
If you’re considering a solar installation, you’re probably concerned about getting value for money. 
Some people choose solar to reduce their carbon footprint.
But Roman Mitchell, co-owner of Marblanc Solar, says that “9 out of 10 clients are interested in solar to lower their bills.”
“It surprises me how many clients are actually investors,” Roman added. “They view solar more as an investment than an eco-friendly upgrade for their home.”
But here’s where the key difference lies. 
While many people like the idea of slashing bills, there’s often hesitation. 
Would they get a better return by investing instead? 
After all, you can’t earn money with a home solar energy system. At least, not directly.
So what’s the case for solar over investing your money into something else?
Marblanc Solar says it has proof of solar’s investment potential, after one client’s bills showed they’re on track for a 17.7% annual return.
How are they so sure?
Adam Millington, co?owner of Marblanc Solar and a qualified electrician, showed the Olive Press the client’s bill from three months after their solar installation. 
It revealed a remarkable result. 
The client actually had a negative electricity cost. They’d earned €9.44 into their “virtual battery” for selling more electricity back to the grid than they consumed.
Adam said: “Our initial proposal predicted the client would be paying an average of €23.50 for electricity each month.” 
“But the results were even better than we predicted, with the client paying nothing for electricity this last October.”
Adam said the client’s annual savings for the first year are predicted at €1,946.
(Marblanc Solar bases all their estimations on the cost of electricity – without including standing charges or taxes.)
Here’s how they arrived at that conclusion:
Adam said: “Our prediction accounts for slightly higher bills in winter as the power output is reduced.”
“But our modelling predicted the client’s October bill would be around €30.32 – and instead the client earned €9.44 in credit.
“This means the final ROI figure for this first year could be much higher than 17.7%.”
Adam added that Marblanc Solar include investment calculations like ROI during their Free Solar Survey for a new client. 
It helps to demonstrate the value of solar.
For example, you can compare a predicted ROI of 17.7% to something like stock market index returns – which have averaged around 13.6% annually over the past decade.
“But here’s the interesting part,” Adam added. 
“The hidden bonus of investing in solar is that inflation increases your actual savings, instead of eating into your earnings.”
Marblanc Solar has a unique quoting process. 
Instead of sending an itemised bill, they carry out a Free Solar Survey.
First, a qualified survey engineer visits the client’s property with a drone to measure the roof space, orientation, shading and angle.
Then, they plug the data into Pylon – the world’s leading solar design software – to run performance calculations. This allows them to come up with accurate estimations.
But Marblanc Solar doesn’t stop there. 
Each proposal also includes calculations for four key financial metrics:
Let’s take a look at how each of these works.
The Net Present Value (NPV) is the present-day value of all future cash inflows minus the outflows. 
Since money today is worth more than money in the future, future savings on electricity bills (inflows) and the costs of installing the solar system (outflows) are adjusted to reflect their value today.
A positive NPV indicates a good investment.
Here’s how Marblanc Solar arrived at an NPV of €40,281.98 for this client:
The Discounted Payback Period also takes into account all discounted future cashflows. 
This period will be longer than a “simple payback period” calculation, because it takes into account the reduced value of future savings on electricity bills and the costs of the solar system installation.
This makes it a better investment metric.
Here’s how Marblanc Solar arrived at a discounted payback period of 5-6 years for this client:
The Return on Investment (ROI) is another measure of the efficiency of your solar investment. 
Imagine you invested €100 today and received €300 in return. 
The ROI would be 200%.
Here’s how Marblanc Solar arrived at a total ROI of 366% for this client over 25 years:
The total ROI of 366% means that. over the course of 25 years, the client will receive more than three times the value of their investment in savings.
The Internal Rate of Return (IRR) is the discount rate that is used to make the NPV of future cashflows equal to zero.
In the case of a solar installation, it represents the rate at which the future savings from reduced electricity bills would exactly offset the initial cost of installing the solar system.
A higher IRR indicates a better investment.
Here’s how Marblanc Solar arrived at an IRR of 20.5% for this client:
Even with good predictions, not every homeowner with solar will achieve the kinds of savings seen in this case study. 
Unfortunately, not every system performs the same.
Adam Millington, co-owner of Marblanc Solar, told the Olive Press he is often called out to inspect installations that were not carried out by his company.
In many of these cases he sees issues like:
The solar industry lacks regulation in Spain. 
And there are companies who take advantage, leaving homeowners with subpar systems and disappointing results.
Adam explains, “This is why Marblanc Solar introduced the most robust post-installation services on the market in Spain. 
“We make sure our clients’ investments continue to deliver the savings they were promised.”
Marblanc Solar’s post-installation services include:
Roman Mitchell added that with solar, the “cheapest” system can often mean the worst savings. 
“We introduced our post-installation services to help clients make the most of their 25-year investment, just as promised in our proposals,” he said.
This example is proof that solar can be a worthwhile investment.
But it also highlights the importance of accurate system design, installation and post-installation services.
Let’s recap on why solar can be a great investment:
If you’re ready to see how much you could save, contact Marblanc Solar today for a Free Solar Survey – or call +34 951 82 30 83
Their team is ready to help you understand your potential return on investment and show you how solar can work for your home.
Click here to read more Environment News from The Olive Press.
Joshua James Parfitt is the Costa Blanca correspondent for the Olive Press. He holds a gold-standard NCTJ in multimedia journalism from the award-winning News Associates in Twickenham. His work has been published in the Sunday Times, Esquire, the Mail on Sunday, the Daily Mail, the Sun, the Sun on Sunday, the Mirror, among others. He has appeared on BBC Breakfast to discuss devastating flooding in Spain, as well as making appearances on BBC and LBC radio stations.
Contact me now: joshua@theolivepress.es or call +44 07960046259. Twitter: @jjparfitt
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