If you are planning for a solar installation, you must consider the energy-efficient factors that affect the performance of your solar panel system.

Firstly, solar panel efficiency is the rate at which your solar panel absorbs sunlight and converts them into electricity through the photovoltaic cells. When efficiency is higher, you will generate electricity at a higher rate. In general, most solar panels have an average cell efficiency of 15% to 20%. Anything above 20% is a great value. Secondly, solar panels are rated based on how much watts of energy they generate. For instance, consider a 380 watts solar panel installed on your roof, where you receive 5 hours of direct sunlight. The calculation goes like 5 hours multiplied by 380 watts is 1,900 watts which is roughly about 2.0 kWh per day. So, you generate roughly around 720 kWh of solar energy per panel for a year.

However, the actual efficiency and output of a solar power system vary depending on several factors that affect the overall performance of a solar panel system. Hence, you should consider the following factors while calculating the solar power for your property.

Inverter Efficiency

Inverters convert the DC current from the solar panel to the AC current to attend to the needs of your home appliances. Even though inverters have a higher efficiency rate, they are not 100% efficient. As a result, inverters typically contribute to an 8% loss in the total efficiency of the solar panel.

Battery Efficiency

Your battery will not provide maximum efficiency if you have a hybrid inverter system. Usually, in a hybrid system, the battery tends to operate at an efficiency that is 8% lesser than the rated wattage. So, it contributes to an 8% loss in the performance.

Manufacturer’s Tolerance

A manufacturer’s tolerance is the power tolerance of a solar system. Usually, the output power and the efficiency of solar power systems are calculated in laboratories under the Standard Test Condition (STC). There will be some change in efficiency from the original STC, and that range is power tolerance. Most solar panels have a power tolerance of +/- 5%, and it can be lower or higher depending upon the manufacturer.

DC and AC Cable Loss

Resistance loss in the DC and AC cables also affects the performance of solar panels. The voltage drops between the solar panel and the inverter accounts for a 1 to 2% loss. Similarly, the inverter and the electrical switchboard also experience some voltage drop, affecting the efficiency.

Temperature Derating

Solar panels work best at lower temperatures, whereas heat affects the performance of solar panels significantly. Every solar panel has a temperature coefficient beyond which when the solar panel gets hot, there will be a severe drop in the output voltage. In addition, the type of installation and ambient temperature also affect the efficiency. For instance, solar panels fixed parallel to the roofs may experience a temperature of 35℃, which consistently affects the efficiency.


The build-up of grime and dust also affects the efficiency of your solar power system. They may account for a 5% loss in solar panel efficiency. They may also vary depending upon your location and the panels you use. However, regular maintenance can prevent this loss.

Angles and Placement

The angle of inclination and the orientation of your solar panel also affect solar energy efficiency. Your solar panels must be placed at an optimum angle or tilt to produce maximum solar energy. Sometimes shading and other climatic factors such as clouds and rain also affect efficiency.

For more information contact the local team of solar installers at Always Energy. We offer solar installation services in Port Macquarie, Coffs Harbour, Newcastle, and the surrounding areas of NSW.

As of December 21, 2020, New South Wales has recorded more than 630,000 small-scale solar power installations. It does not matter how much electricity you consume; solar power installation will be sure to be a long-term investment for you or your business.

What Is the Benefit of Installing Solar Power

Apart from self-sufficiency and efficiency, solar power installation adds value and benefits in the long run. Here is the best way to help you figure out how solar energy will benefit you.

Typically, installing a solar energy system could reduce your quarterly electricity bill by as much as $400 to $500. For instance, a 5kW solar system generates roughly 20 kWh a day. Depending upon your electricity usage, you may save up to $1200 to $1500 a year. A good quality solar system can pay for itself within 3 to 6 years.

An effective solar power system has a lifespan of around 25 years, and some can survive even beyond 25 years. Firstly, most solar power systems give a payback or return on investment within 5 to 6 years. It depends upon the quality of your solar system and the size of the system you choose. If you go for a bigger solar power system size, you can start seeing returns within 3 to 4 years. However, your payback hugely depends on the cost of your solar energy system and the government rebates. In addition, weather, direction, tilt, and electricity usage patterns also affect your payback.

How Does Solar Power Benefit You?

There are two ways by which you can start saving and benefit from your solar power installation.


Typically, you may be paying your electricity retailer about 30 to 40c per kWh. While, on the other hand, when you start consuming the energy generated from your solar panels, you can significantly save or cut down on that cost, which is called self-consumption. When your self-consumption rate is higher, you’ll reap higher rewards.

Feed-in Tariff

Secondly, you will start getting feed-in tariffs or credits from your retailer for the excess energy generated from your solar panels. In other words, every time you start feeding the surplus solar power to the grid, you start receiving credits. The rates of feed-in tariffs may vary between the states and the retailers. In NSW, you get a minimum rate of 6 to 7.3c per kWh, indeed much lower than the rates you pay for buying electricity.

Even though the feed-in tariff rates are lower, given the savings you make from self-consumption and the extra you receive for selling solar power, solar installation is beneficial and economical.

So, if you want to invest in a good quality solar system, this is the time as solar panels are more affordable and efficient now than ever before. Also, keep in mind that the solar rebates are reducing every year. So, make sure you invest in a good quality solar system from a CEC accredited solar installer for better performance.

Contact our expert solar installers located around Port Macquarie, Coffs Harbour, Newcastle, and the surrounding areas in New South Wales. Call Always Energy today!