Understanding the financial payback period for solar panels in your home

Solar panels are a clean and renewable source of energy that could help you save money on your electricity bills – as well as reducing your carbon footprint.

As global energy markets fluctuate, solar panels give you the opportunity to generate your own clean, ‘free’ energy, and a home battery means you can store the power for when you need to use it.

While installing solar panels will involve an upfront investment, over time, this form of home upgrade could pay dividends by reducing your energy bills. As well as reducing your reliance on the energy grid, you could also make money from the electricity your solar panels generate too, via the government’s Smart Export Guarantee (SEG) scheme.

How much do solar panels cost?

Prices start for a six-panel system (2.85 kWp) with on-roof solar panels at just £4,995,¹ while a 12-panel (5.70 kWp) system starts from only £6,495, at E.ON Next. Get a quote online, and E.ON Next’s expert team will recommend the right number of solar panels for your property, as well as a battery and tariff, to help you make the most of your new system. They will also create a custom design to suit your property and optimise the efficiency of your new solar panels.

The overall system price can vary depending on factors such as the number of panels, what size battery you add, how much scaffolding is needed, and if you choose panel optimisers to maximise generation performance.

¹ The price is based on a six-panel package (on-roof), single elevation of scaffold, with single-phase electrics, and no complexities, for example installing above a conservatory or digging trenching required for electrics.

Can solar panels reduce my energy bills?

By installing solar panels in your home, you could reduce the amount of energy you need to purchase from suppliers.

Solar panels generate renewable electricity during daylight hours using sunlight, regardless of weather conditions. While more power can be generated on sunnier days, panels can produce energy even on cloudy days.

With solar battery storage technology, you can store the excess energy generated during the day, providing you with power even once the sun sets.

You can still top up your electricity use with power from the electricity grid if you need to, but solar panels can reduce your reliance on it – which could be particularly good news amid rising energy prices.

You could potentially save up to £734 per year on energy bills, according to E.ON Next, and, by selling extra electricity you generate back to the grid, you could make an additional £412. This is based on an annual usage of 4,000 kWh and an electricity price of 24.67p/kWh (Ofgem April 2026 price cap rate), assuming a south-facing roof (35° pitch and no shade). Savings include the expected returns of a 12-panel system (5.70 kWp), along with SEG payments.

The amount you save will depend on a number of factors, such as the size of your solar system, the amount of sunlight your home gets, your local electricity rates and your current energy consumption.

When you use electricity and how much you use can also impact your energy bills. For instance, households who are at home all day will generally see higher savings than those who are out during the day, according to the Energy Saving Trust. If you’re using less power than your solar panels are generating, a solar battery or SEG tariff will let you make the most of the excess electricity being created.

If you use a lot of electricity, you are more likely to need to pay for extra power from the grid, which could impact the amount you save on bills.

How can you earn money by exporting excess power generated by your solar panels?

If you generate surplus electricity through your solar panels, you could sell it back to the grid by joining the Smart Export Guarantee (SEG) scheme.

The scheme was set up by the government to encourage people to generate more renewable energy. It means energy suppliers, like E.ON Next, pay domestic and business customers for excess energy they generate via renewable sources, such as solar panels.

E.ON Next is a mandated SEG licensee and offers four SEG tariffs. With their 12-month fixed-term Next Export Premium v3 tariff, for instance, you could get 17.5p per kWh of electricity you export.

You get SEG payments annually along with your renewal, but you can request to increase the frequency to up to three extra payments per year (four in total).

Can you spread the upfront cost of a solar panel installation?

There are different ways to pay for a solar panel installation. You could pay upfront, or spread the payments over time.

E.ON Next offers flexible payment options, so you can manage the cost of the home upgrade in the way that best suits you.

For instance, you could divide the cost into three manageable chunks – pay a 25% deposit, then 50% when the materials are ordered and the final 25% once the installation is complete.

E.ON Next also offers a 0% APR finance option for up to three years*, so you can upgrade your home with solar panels in a way that suits you.

However you choose to pay, rest assured there are no hidden installation costs. The price you are quoted includes everything from scaffolding to solar PV panels and inverters.

* E.ON Energy Installation Services Limited is a credit broker not a lender and works exclusively with HomeServe Finance Limited who acts as the lender under Firm Reference Number 994955. Any credit is subject to status, affordability and a credit check; HomeServe Finance Limited terms and conditions apply.