Solar Vs Home Inverter: Which is better? Know to save million dollars

PV Solar VS Home Inverter System min

PV SOLAR OFF-GRID SYSTEM VS HOME INVERTER SYSTEM

What is your guess? If we compare the solar Vs Home Inverter, which will be more economical? 

Well you may have guessed it correctly. It will be solar

Let me ask the same question differently. If you have to install a system today, which one will you choose?

Well, my experience is that the majority of you will opt for a home inverter. There are valid reasons for it but I will not delve into it here.

This decision is a bad decision from an economic perspective. Let me explain why I am saying so.

STEPS TO FIND THE DIFFERENCE BETWEEN SOLAR VS HOME INVERTER

Let us first see why the home inverters are costly. We will then find the cost of running a home inverter for 25 years, taking an example of an inverter producing 1000 W.   

Similarly, we will see the reasons why to opt for the PV solar system and see the costs involved in a PV solar system. We will take a 3 KWp inverter, here (As a 1000 W PV solar system will be too small for most of the home). 

We will compare the costs of the two systems to ascertain the difference between the two.

WHY HOME INVERTER BECOMES COSTLY?

There are losses associated with the home inverters.

For each unit of power given by the home inverter you are paying 1.6 times the cost of the grid tariff. 

If you want to know the basis of the saying then you can refer to the link below: 

Do you know there is 60% power loss in Home inverter use? It isn’t cheap.

The impact of this 1.6 time increase in running cost might seem small as it runs only a few hours a day. But since it is a recurring expenditure hence over a period of time it becomes a substantial amount. Let’s take a look at the economics of running a home inverter for 25 years the life of the solar.

ECONOMICS OF RUNNING A HOME INVERTER

Want to know in detail? How much will you pay? Refer to the attached  link. 

Home Inverter running cost: How much you pay for using it ?

The summary of the above article in the link is that within 25 years (the life of PV Solar System) the expenses of power only (without considering the replacement of batteries or other costs) comes to approx Rs.415,200, for getting a 1000 W output of inverter or 1 Unit/Hr inverter power consumption.

Assuming that the investment has already been done in the home inverter, its cost has been ignored in the calculation. The batteries required have not been considered, since the same battery cost will also be required in the off-grid PV solar system. The expenses of Rs. 415200 will further increase If taken into consideration. 

Now let us look into the reasons to opt for the PV Solar System .

WHY OPT FOR PV SOLAR SYSTEM?

First let’s understand why most people don’t opt for PV Solar System? 

Primarily, due to these three reasons, as I see it:  

1.  People have doubts that the PV solar system will be more economical. 

2. The installation base is still low, people don’t hear much about it, you don’t get references. The PV Solar System is yet to become a household product,

3. The initial investment of the PV Solar System is high.

Here, we have to keep the following points in mind about the PV Solar system:

  1. It converts the free solar energy to give power so the recurring costs are almost nil.
  2. There are no moving parts in the PV Solar System, so frictional wear and tear don’t take place, as it takes place in a Diesel Generator. 
  3. The PV solar system has ZERO running cost. This leads to savings and not expenses as in the case of the home inverter. 

Let’s take a case study of a 3 Kwp off-grid Solar system to fully understand the implications.

ECONOMICS OF RUNNING A PV SOLAR SYSTEM

Savings from the PV Solar System: Case Study of 3 Kwp off-grid Solar System

The summary of the above link is that the PV Solar system saves Rs. 3.70 lacs, after recovering the cost of the PV solar system, taking the present electricity rate as Rs. 6.5.

Note: We have taken the installation cost of the PV Solar System with batteries, the additional batteries that will be required within 25 years, has been ignored, as it will be required in the home inverter also.

DIFFERENCE BETWEEN HOME INVERTER AND PV SOLAR SYSTEM:

Now, that we have understood both the systems, here I am summarizing the difference in usage of home inverter and PV Solar System for better understanding:

Now, that we have understood both the systems, here I am summarizing the difference in usage of home inverter and PV Solar System for better understanding:

HOME INVERTER

  1. The investment on the home inverter doesn’t cause savings.It leads to an increase in electricity bill and hence increase of the monthly expenses. 
  2. Contrary to our understanding the power supplied by the home inverter is not cheap, various losses are associated with storing of energy and charging the battery. This increases the cost of the home inverter power by approx 60%. Suppose the electricity tariff rate is Rs.6.5/Unit, then the electricity supplied by the home inverter will cost you Rs. 10.4 per unit.
  3. The electricity tariff rate goes on increasing with time, and hence the cost of the power  supplied by the home inverter also goes on increasing.

PV SOLAR SYSTEM

  1. The PV Solar system has zero running cost (due to using of free solar energy).  
  2. Unlike the home inverter, It generates substantial savings and doesn’t involve recurring monthly expenses.  
  3. It fully recovers the capital investment done on solar.
  4. It also has a long life (25 years or more). 
  5. The home inverter provides power only when the grid power fails, but the PV solar system powers the house and charges the battery during the daytime. This reduces the electricity bill of the grid power. 
  6. The PV solar panel enhances the life of the roof and substantially reduces the energy required in cooling the room/office. A roof is not heated on installing the solar panels.

The above gives the theoretical understanding of the difference between the two kinds of systems. To understand the actual impact in monetary terms, let’s compare the expenses incurred in the Home Inverter and the PV Solar system. 

THE ECONOMIC COMPARISON OF THE TWO SYSTEMS:

  1. The home inverter led to the expenses of Rs.4,15,200, without considering the investment on the home inverter ( as per link above)
  2. The PV Solar System led to the savings of Rs.3,65,367 after recovering the cost of the PV Solar System (as per link above).

This effectively means that within 25 years, you will save a whopping sum of Rs. 7,81,567 by replacing your inverter with PV Solar System ( saving the inverter expenses + savings from the PV Solar System)

WHY THE RIGHT TIME TO BUY IS NOW

Fun Fact: PV Solar System cost has gone down by 85% within a decade making it the most eco friendly and budget friendly option available in the market. 

  1. The price of the PV solar system has already hit the bottom low. Now, the price of the PV solar system is increasing.
  2. The government subsidies are tapering down. Because now the solars have become quite affordable.
  3. The unutilized solar energy goes wasted, you can’t preserve the solar energy. The savings will happen only when the PV Solar System is installed, the expenses incurred can’t be recovered.

Hence, the earlier you buy, the more you will gain on savings.  

Presently, the solar market is not even 1% of the total market size. As the advantages are discovered en masse, like the computer and Air Conditioner, it soon is going to be a household item, multiplying many fold. 

It’s time to go green, switch to the PV solar System. don’t remain stuck with your home inverter system, you will be losing lacs because of the wrong choice.

Disclaimer: The contents of this page are for informational purposes only and is not intended to solicit any professional advice, users are advised to use their own discretion before relying on any of the contents of this page. The information contained on this page has been sourced from the various public websites and available resources.

Disclaimer: The contents of this page are for informational purposes only and is not intended to solicit any professional advice, users are advised to use their own discretion before relying on any of the contents of this page. The information contained on this page has been sourced from the various public websites and available resources.

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