7kW solar systems: Prices, output & return on investment

These days, depending on your state, the size range for a residential solar system is ordinarily between 3kW and 5kW. With 5kW being one of the most popular system sizes in the country – 7kW is only a bit above average, and not much of a stretch economically for households with a flexible budget for a solar system.

How many solar panels in a 7kW solar system? How much area required?

A 7kW solar system using 275 watt (W) to 320W modules will consist of about 25-28 panels.

Each panel generally measures out to about 1.7m2, so the roof area required for a 7kW system will be about 40-48m2 – or possibly more depending on how your roof is laid out and whether you require tilt frames (which need to be spaced out more than panels mounted flush on the roof).

Pricing for 7kW solar systems

Solar Choice publishes a monthly Solar PV Price Index that tracks average pricing trends in every capital city in Australia.According to Solar Choice’s own data, the average 7kW solar system price in Australia as of October 2019 is about $1.03 per watt – or about $7,220, with a low of $0.53/W and a high of about $1.43/W.

The table below, from October 2019, provides a snapshot of price trends for 7kW solar systems in capital cities around the country.

7kW Solar PriceHistoric pricing for 7kW solar systems through to October 2019.

 

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Typical power output 7kW solar system

Depending a number of factors, the actual power output of a 7kW solar power system will vary. These factors include:

-Geographic location (e.g. Darwin generates much more energy than Hobart)

Orientation and tilt angle of the solar panel array

The degree to which the panels are shaded by nearby objects

-Operating temperature of the panels

The table below provides some rough guidelines as to how much energy you can reasonably expect a north-facing 7kW solar system (operating at a 75% efficiency ratio) to produce in Australia’s capital cities. Please note that the figures in the table are daily averages; in reality, a system will produce more energy in the longer days of summer and less in the shorter days of winter.

7kW solar system
Capital CityApprox daily solar energy production
(annual average)*
Adelaide25-29kWh
Brisbane27-29kWh
Canberra25-29kWh
Darwin31kWh
Hobart20-23kWh
Melbourne22-25kWh
Perth28-31kWh
Sydney24-26kWh
*Via PVWatts & Bureau of Meteorology

 

Payback period & ROI for a 7kW solar system

Payback periods for any size solar system are contingent on a number of factors, but one of the most important ones for homes and businesses going solar these days is ‘self-consumption’. These days, with only low solar feed-in tariffs on offer in pretty much every state, the business case for going solar is based mainly on how much of  the solar power will directly used by the home or business.

Here’s why: If you own a solar system, the electricity it produces is worth much more to you if you consume it yourself than if you allow it to be ‘exported’ to the electricity grid. If you self-consume 1kWh of power, you avoid purchasing 1kWh of electricity from the grid, thereby saving anywhere from 18¢-¢40 on your power bill, depending on your location and what your electricity retailer/utility charges you for electricity. By contrast, if you allow the power to be exported to the grid, you will generally earn between 7-13c/kWh in solar feed-in credits.

So how can you make sure you use as much of your solar power yourself? Step 1 would be ensuring that you get a solar system that is appropriately-sized for your needs. Step 2 would be understanding your electricity usage profile and working to optimise your power usage. (Note that power from a system’s solar panels will automatically go straight into any appliances that are running, and the excess will automatically flow into the grid.)

That being said, the table below provides some indicative payback period figures for 7kW solar systems in a handful of capital cities in Australia.

Indicative returns for 7kW solar systems at average prices in select capital cities

(Assuming 30kWh electricity consumption/day)

 Sydney

(assumes 11c/kWh feed-in tariff, 25c/kWh retail rate)

 Brisbane

(assumes 11c/kWh feed-in rate, 21c/kWh retail rate)

 $6,760 $7,190
 @ 20% self-consumption @ 40% self-consumption@ 20% self-consumption@ 40% self-consumption
 ~5 year payback ~3.9 year payback ~5.3 year payback ~4.4 year payback
 ~19% IRR~26% IRR ~19% IRR ~23% IRR
 ~$1,302 annual savings ~$1,664 annual savings ~$1,334 annual savings ~$1,601 annual savings
Melbourne

(assumes 11.3c/kWh feed-in tariff, 21c/kWh retail rate)

Perth

(assumes 7c/kWh feed-in rate, 27c/kWh retail rate)

$8,010$5,660
@ 20% self-consumption@ 40% self-consumption@ 20% self-consumption@ 40% self-consumption
~6.7 year payback~5.5 year payback~4.6 year payback~3.3 year payback
~14% IRR~18% IRR~22% IRR~31% IRR
~$1,131 annual savings~$1,398 annual savings~$1,199 annual savings~$1,696 annual savings

You can experiment with the numbers yourself using Solar Choice’s Solar PV System Payback Calculator.

Compare quotes from up to 7 pre-vetted installers in your area now.

Since 2008 our knowledge and sophisticated software has allowed over 160,000 Australian households and businesses to make a well-informed choice on their solar & battery installer.

 

© 2019 Solar Choice Pty Ltd

Comments

  1. I have a company here in NH who just quoted a 7KW ground mounted system for Just over 30K, with the 30% government tax credit and $3500 of state cash back it came out to a little over 17K our cost. Our electricity bill is on average $150 a month for 12 months. I am 55 yrs old and don’t see the payback of 12yrs as being worth it. I would do all the site work – level area where pads are to be laid, cut trees, and dig trench for electrical from panels to house, and poke a hole thru my foundation for the conduit. Price seems more than excessive don’t you think?

    1. Hi Paul. I can’t really comment on the situation in New Hampshire as we service the Australian market. The 7kW system at $30k works out to around $4.30 per watt–that’s definitely on the expensive end for a system of that size installed in most places in Australia. Payback periods here are more in the range of 4-7 years.

      Is that the best price you’ve been able to find for your area? And I assume you’re not entertaining the idea of going with a leasing deal?

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