Really, How Much can you Save going Solar?

One of the major cost that is boring holes into the pocket of most households and businesses is – the cost of running their generators.

Day in day out, the price of fuel (apart from generator maintenance costs) keeps getting higher without fail. This ongoing trend tends to increase power supply bills – while reducing how much they can actually spend on crucial expenses such as school fees, rent, food, investment and even savings in the bank!

It is a troubling thought that Nigerians (and Africans by extension) are going through this experience when there are good alternatives (such as Solar) that would guarantee 24 hour electricity – stress-free!

How do we know this? Let’s take a quick look at a simple household cost-scenario.

Using a small tiger (I–pass-my-neighbour) generator, we will analyse what it takes to ‘fuel it’ on a daily, weekly, monthly and yearly basis.

The current official price (black market is even more expensive) stands currently @ =N=145/Liter. In order to get six hours of electricity a day, six liters of fuel is needed.

If we safely assume that most households use an average of six hours of current daily, then it means that they spend =N= 870 in total.

Five days a week of the same cost turns into =N= 4350

4 weeks = 1month gives  a cost of =N= 17400

12 months = 1 year gives a cost of =N= 208,800

5 years = gives a cost of =N= 1,044,000 (minus inflation and assuming the cost of Petrol remains the same over the time period)

10 years = gives a cost of =N= 2,088,000       ‘’

25 years = gives a cost of =N=5,220,000       ‘’

And the cost never stops. We keep buying fuel to ensure we provide our own electricity. It’s a never-ending cycle!

But take a look at this:

The equivalent of the tiger generator is the 500 watts Solar Home System.

The One off cost is – 402,300 (with 25 years product warranty & 24 hours electricity NOT 6 HOURS!)

Doing the Maths, lets first find out how long it would take for us to recover the money spent on purchasing the solar system if we were to purchase fuel for running our Generator (Tiger Generator in this case) for a 6 hours daily.

Cost of 500W solar System = N402,300

Cost of running Gen for 6 hours every day for 12 months = N208,800

Therefore, if we divide the cost of the Solar system by the cost of 12 months of 6 hours power from Generator, we will get the time it will takes us to get our money back (ROI).

Calculation

402,300/208,800 = 1.9

This means that it will take us 1 year 9 months to recover our money spent in buying the 500W solar system if we were still buying petrol for the generator.

Savings

What the above also means is that if we were to purchase the 500W solar system, our payment for alternative power stops in less than 2 years, allowing us to save N208,800 every year in terms of amount not spent into the next 23 years.

This simply works out to be;

Calculation

23 Years X N208,800 = N4,802,400 (Four Million, Eight hundred and two thousand, four hundred naira)

With such an amount, you could purchase land/property investments, pay for your children’s Education and most of the other important expenses you need to settle.

Settling for small costs that would accumulate into a never-ending mass of debt doesn’t appear to be prudent. So why wait to be consumed by such a burden?

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