Solar power: can you really earn 12pc? Graham Ayling, a spokesman for the Energy Saving Trust (EST), said: "Solar can offer an insulation against some of the fluctuations in energy prices, so your bills and supply are no longer at the whim of politicians, energy companies and global markets." An independent advice charity, EST estimates a typical cost-saving of £785 annually, in return for a £7,000 average investment in panels. This more than wipes out your annual electricity bill of £479, paying an additional 63pc on top. The Solar Trade Association puts the annual savings slightly higher at £823, largely because it has a higher estimate of how much you will use yourself. On this basis, the STA estimates a system will give a 12.5pc tax-free annual return over 25 years. The EST does not estimate returns but also does not dispute STA's claim. But all these savings come at a cost. You need to make an initial investment of around £7,000 to reap the benefit, remembering the lost opportunity cost of investing that cash elsewhere. It can take a decade to break even, so you must be confident of not moving. The EST admits its figures are based on optimum assumptions, a London postcode, where the sun shines more than elsewhere. The calculator on its website shows the highest savings were in Cornwall, where they reached £739 annually. This dropped to £669 in South Warwickshire and £651 in Middlesbrough. Here we answer your questions about buying solar panels. Why invest in solar panels? You can benefit in three ways. First, you are paid a set fee for every unit of electricity you generate, known as the "feed-in" tariff, regardless of whether you use it. You then get to use for free as much of your generation as you can. This is only possible during sunlight hours. What you cannot use, you can export back to the grid, for which you are paid an export tariff. When launched, the feed-in tariff was more than 40p per unit or kilowatt per hour, and you could lock into that rate for 25 years. However, the tariff is adjusted according to take-up and is currently 14.9p, fixed for 20 years, although the cost of panels installation has also come down. The export tariff is currently 4.64p. Whichever tariff you fix at, it is guaranteed to rise annually in line with inflation. How much will I save? That depends on how much you generate, the direction in which your house is facing, the pitch of the roof, the system you opt for and whether you are at home during daylight hours. A smaller, cheaper system may not provide capacity to make substantial impact on your bills. The power of a PV cell is measured in kilowatts peak (kWp) and a domestic unit should be a 16-panel 3.5-4kWp. According to the EST, its average annual cost savings of £785 is made up of £556 paid via the feed-in tariff for the electricity you generate, £143 for the money you save on electricity by using power you generate and £87 for units exported back to the grid. The Solar Trade Association cuts the numbers slightly differently. It suggests you might, on average, earn £507 from the feed-in tariff, £283 from domestic use and £79 from the export tariff. It also allows £46 towards the cost of annual maintenance. How much does it cost? Panels can cost anything from £5,500 to £9,000, averaging £7,000, EST says. The STA puts the average at £6,500. Depending on generation, you might break even after 9-11 years. After that you can keep the extra cash you generate. Where do I start? A good place is the EST calculator at est.org.uk/solar which will help you establish what sort of system you might require and what your generation and savings might be. After that, always get quotes from at least three installers who are registered with the Microgeneration Certification Scheme, (microgenerationcertification.org), which guarantees certain standards. The Renewable Energy Consumer Code also carries a list of companies which have signed up to its standards and higher practices. If all three are giving you the same advice, then you should feel confident about proceeding. But always check contracts carefully. For example, the length of warranties may vary. Am I guaranteed to save money? Unfortunately not, and complaints under the Renewable Energy Consumer Code have mushroomed because householders were promised savings, which did not subsequently materialise. For example, for maximum generation, you need a south-facing roof, with a perfect 45 degree pitch, with no shading from chimney pots, overhanging trees or nearby buildings. The generation from a north-facing poor pitch could be so weak, you might never recoup your investment. Mr Ayling said: "South facing is best, but west or east facing are OK, too, although they will cut generation by about 15pc. North is the least useful. Systems are most valuable to those who are at home during the day and can use more of what they generate themselves. Are bright summers the key? The panels do not require full sunshine, but the sort of light which can penetrate clouds. Some households might have seen a fillip this year, but for most this would have been wiped out by the poor spring. Mr Ayling believes generation on his own domestic system could be up about 12pc over the year. However, Oxfordshire householder John Groves, who saw his generation rise by 5pc, said: "Although I did generate slightly more over the summer quarter, my spring quarter was lower than last year. My system performs pretty consistently from year to year, almost irrespective of the fluctuations of the weather. The retired physics teacher installed panels when they were more expensive - £13,000 - in 2010 but receives the top rate for generating power. What other problems should I consider? It may not be possible to erect solar panels on a listed building or in a conservation area, and you should always check with the local authority, to make sure it does not require planning permission. You must also check with your mortgage lender and insurer before buying. Although lenders were initially nervous, most now lend on properties with panels. Insurers, too, are more relaxed although some may charge a small additional premium. Think carefully about the system you buy and the impact that might have on the look of the property if you have to sell. What if something goes wrong? The Renewable Energy Association has a Consumer Code and complaints procedure at recc.org.uk. It also operates an insurance-backed warranty scheme called the Deposit and Workmanship Warranty Insurance Scheme. For purely technical complaints, the Microgeneration Certification Scheme has a separate complaints procedure. Panel firms take a beating A rogue solar panel salesman was last month jailed for nine months after pocketing up to £8,000 per victim for selling solar systems to customers who could never benefit. Passing sentence at Bournemouth Crown Court, Judge Samuel Wiggs described Floyd Lewis, of Totally Solar and Advanced Solar, as "cavalier beyond words." A report from the Office of Fair Trading into the £18bn a year renewable energy industry identified a variety of bad practices and claimed some consumers had been pressured into buying systems which were worthless to them on the basis of false information. Complaints under the Renewable Energy Consumer Code soared from 30 three years ago, before the advent of the feed-in tariff, to nearly 1,130 during 2012. Misleading information accounted for nearly one in five. Problems with homes being damaged and other installation hitches accounted for one in 10 complaints. Nearly a third of complaints were rows over deposit refunds, where customers changed their minds during the cooling-off period, but couldn't get their money back. Paul Barwell, chief executive of the Solar Trade Association, said the increase in complaints has to be put into the context of the explosion in installations. He said: "It is true the number of complaints about solar panels have increased, but so has the rate of installation. More people are doing solar now, so it is fair that this industry is open to the same scrutiny as any other. The question is has the proportion of complaints increased? The answer is: very minimally.