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Choosing the best system size for your property

Choosing the Best System Size for Your Property

When choosing the best system size for your property, there are three key factors you will need to determine:

  1. The proportion of your electricity usage you are aiming to meet with solar energy.
  2. The area of ‘optimal’ roof space you have available for solar panels. Roof orientation is important, and best results will be received from north-facing panels that capture the midday sun.
  3. Your budget (see our advice on making the decision to invest).

Electricity usage

There are a few factors to consider around how much of your daily electricity consumption you can meet with solar generation.

  • What amount of energy does your home currently use? You can usually find this information on your electricity bill, but for an average family home, most consumers use around 8000kWh per year.
  • How much of that energy consumption can be replaced by solar is then dependent on when you use that energy. If your household is out of the house during the day (at work, school etc.), then chances are the majority of that energy is used early morning and evenings. You will still require electricity supply from the grid to meet demands at peak times, but you can also find ways to maximise the benefits of your solar system.

Solar system sizes

When we talk about solar systems, we talk about the kW rating, which is the maximum amount of energy the system can generate at its peak output. For residential customers, this would commonly be a system with a maximum output of between 1.5kW and 4kW, with commercial operations generally requiring systems 5kW and over.

As a rule of thumb, you can expect to pay around $3 per watt installed. So for a 3kW system (3000 watts) you would expect a market price of approximately $9,000. As system size increases, our research indicates that cost per kW commonly reduces.

However, it’s not that "bigger equals better" – to get the best value, the size of your solar system needs to closely match your electricity usage. Buy back rates are not high enough to offset the cost of investing in a much larger system.

Also, you are still likely to have an energy bill. This is because of how solar energy is produced, stored and used. The electricity you need to purchase to meet your energy demands will be charged at a higher tariff than you will receive for the energy you sell to the grid.

This means understanding the daytime electricity usage patterns of your household, and selecting a solar generation output capacity that best corresponds. Maximum benefit is achieved by using the electricity you generate, meaning you avoid the higher cost of purchasing electricity from the grid. Low market buy back rates for surplus generation exported to the grid do not support investing in higher cost, larger capacity, systems.

One consideration in selecting your system size is whether you plan to incorporate battery storage now, or in the future. You will need to be generating excess energy to charge your battery system.

We have conducted research to look at the portion of solar generation that would be directly consumed by a common residential household using an average of 22.4kWh of electricity per day. The table below summarises the percentage of solar generation consumed versus exported to grid.

Comparison of Average NZ Household Consumption of Solar Generation, Based on System Size

  Size of Solar Generator
  1.5kW 2kW 3kW 4kW 5kW
Generation Consumed (kWh)* 95% 85% 67% 55% 46%
Generation Exported (kWh) 5% 15% 33% 45% 54%

*this table does not consider changes in consumption behaviour to maximise use of solar generation.

Summer generation & household load

Winter generation & household load

Solar Generation Data
Solar generation forecasts are based on projected average monthly sunshine irradiance levels (W/m2), with assumed solar generating efficiency of 92%. The summer curves represent forecast average generation for the period of November to February, and the winter curves for the period of May to August.

Energy Use Data
Household energy use profiles are based on a sample of 750 Hawke's Bay residential properties, on a 24-hour uncontrolled tariff.