3kW Solar System Cost
Reviewed by
Leigh McInerney
The cost of a 3 kW solar setup fluctuates wildly, similar to a kangaroo’s hop, depending on the installer, their chosen equipment, and the extent of the subsidy provided by your local council. Continue reading to find out why this system might just be your ace in the hole.
A standard 3 kW solar system could cost around $4,270 in Australia, all factors considered [1].
There are some brands that offer great quality at a reasonable price. See below for more information.
While there is not much variation in overall cost, some of the factors that play an important role in high prices, especially in Australia, are as follows:
- Solar rebates – Rebates are provided courtesy of the federal government via the Small-scale Technology Certificates (STCs). Rebates are already covered for any solar product you purchase as a discount.
- Unique installation requirements – e.g., roof type, type of inverter, batteries, extra wiring, etc.
- Feed-in tariffs – incentives given in most Australian states to encourage you to go green. This means utility companies will pay you for the excess energy generated by customers and feed back into the grid.
- Solar system type – some 3 kW smart solar systems may cost a little more than standard ones. Â
In a standard 3 kW installation, a solar vendor or installer will quote the total price, including installation charges. This means the cost covers the cost of all solar panels, installation, and other related expenses. However, as mentioned earlier, unique installation requirements may influence the cost of installation.
For instance, if your installation presents unique challenges in terms of wiring length and routing or roofing, your solar vendor should be happy to provide personalized pricing that isn’t much different from the quoted cost. At the same time, simple installations that have fewer requirements than anticipated in the quote should also attract a personal discount from the solar company.
How Much Energy Will A 3 kW System Generate?
Perhaps the most important question to ask for the installation of a solar system is the energy generated by the system. By doing so, you can get a clear picture of the cost savings and how long it will take to cover the initial costs. This is especially important considering small to medium-sized homes that usually don’t spend that much on electricity. So, how much energy would a 3 kW system generate in Australia?
A good rule of thumb is that you can expect a 3 kW system to generate around 12–14 kWh per day on average. However, in Australia, a standard 3 kW system will generate anywhere between 11.7 kWh and 16 kWh, depending on where you live and the hours of sunlight. Unlike other energy sources, solar panels depend on environmental factors (solar ray availability and intensity) for energy production, which vary from state to state in Australia. For example, a 3 kW system in Sydney will produce, on average, 11.7 kWh per day while in Perth it will generate nearly 13.2 kWh per day [2]. Below is a table with typical 3 kW solar system outputs for some of the major cities and states in Australia:
These estimates are made from historical client data as well as real-time climate information for solar energy from the Australian Bureau of Meteorology.
It’s also good to note that solar system output can vary depending on the type of system installed and seasons. Typically, some states/cities will naturally have significantly higher solar energy outputs in the summer and vice versa in colder seasons. At the same time, installing a higher-quality 3 kW solar system with optimal energy production will have better yields.
Having a clear idea and plan of the expected energy outputs is important for a number of reasons, such as:
Energy Planning– Knowing when to expect higher production will help you plan how to split electrical usage between the grid and solar system. This way, you will ultimately achieve the predicted *payback period for your solar system and also become more efficient with energy consumption.
*payback period refers to the duration you’ll have to wait until the cost savings from the installed system. Typical 3 kW solar systems have a 3-5 year payback period in Australia, depending on the energy output and weather conditions [3]. However, in some states like Western Australia, a 3 kW system can payback within a 4–5 year period, while in Victoria it’s more like a 5–7 year period [4].
Plan for upgrades– Ultimately, most people would prefer to move their entire energy system to a greener, more cost-effective one. Understanding what you get from a standard 3 kW solar system might help you to determine if you need to move to a 5 kW system or add more solar panels.
How Many Panels Do I Need for A 3 kW Solar System?
Standard 3 kW solar systems need 12, 250 watt solar panels in Australia. This means all solar panels will, in total, add up to the 3000 watt figure quoted for a typical 3 kW solar system. In terms of size, a standard solar panel for this kind of setup will require at least 198 square feet of roof space (roughly 20 meters squared), with each solar panel measuring about 1m by 1.6m [5].
Hence, you shouldn’t have to worry about details such as the number of panels as an end-user. In most cases, the solar installer or vendor will be responsible for the technical details and will only need to ascertain that you have the required roof space for the solar system you want to install. At the same time, solar panel sizes may vary slightly from manufacturer to manufacturer.
How Long Will A 3 kW Solar System Last?
Regardless of the wattage or manufacturer, each solar product is quite durable and requires low maintenance. Note that solar panels can be placed on your roof for months, even years, without any requirement for repairs or maintenance.
Standard solar system installations will last for over two decades or more, depending on environmental factors and the quality of the solar panels used. This means you can use solar energy after achieving the payback period (EPBT) and can make significant savings during the period.
Hence precisely. a standard solar panel is made to last for at least 25 to 30 years while performing at its peak. With an estimated 0.8% yearly degradation rate [6], a solar panel will still maintain a decent performance rate (about 83%) even after passing the 30-year mark and not fall than the 80% [7]. In fact, unless they are damaged through physical forces or harsh conditions such as fires, solar panels can go on producing energy for many more years.
With the above in consideration, most 3 kW solar systems will come with 25-30-year manufacturer warranties. Alone, these extended warranties can give you assurance or an indication of how long the solar system will serve you.
Hence, there are a few measures you can take to make sure your solar installation lasts as long as possible, among them:
How Long Until A 3 kW Solar System Pays for Itself?
An important question regarding solar energy installations is the payback time or EPBT, as it’s officially referred to in green energy circles.  The standard payback time, as mentioned earlier, is three years for a 3 kW solar system installed on a standard Aussie home. However, there are additional determining factors that may influence this duration.
Daily Energy consumption– using up all your solar energy as opposed to feeding some back to the grid will obviously reduce the payback period. This is because you will be able to cut down on the energy you spend from the grid.
Exported energy– this factor is closely tied to the consumption rate in that you’ll end up stretching the payback period should you export more of your generated electricity to the grid as opposed to spending it. That said, the variation in most Aussie homes is negligible and solar installs often have their positives even when they are installed on credit.
More importantly, it’s good to appreciate that solar energy is best utilized when you have a daily need for power. This means that installing a solar system in a holiday home or one you rarely use in the daytime is not worth it and could have even longer payback times. Unless you have a robust battery storage setup (which is still expensive in Australia), you will be feeding a bulk of the generated solar energy back to the grid for a paltry 8c per Kwh.
The ideal approach for reducing payback times and making savings is to use as much of the solar energy generated daily as possible. In most homes, using at least half (50%) of generated electricity in the daytime is achievable and should be encouraged. Make sure to get a quote with details about payback periods from your solar company to help you plan and finance.
Sizing an Inverter for the 3kw Solar System
Depending on factors such as solar output and energy requirements, you may be advised to undersize (overclock) or oversize your inverters.
Under-sizing a solar inverter refers to installing an inverter whose capacity is slightly lower (mostly 30% less) than the nominal production capacity of your solar panel system. For example, in a 3kw solar system, you could choose to install an inverter rated for 2.4kw or slightly less.
There are many reasons and advantages associated with overclocking (under-sizing) a solar inverter, especially here in Australia, where it’s very common practice. Some of them include energy gains in different sun irradiation windows, climate, energy consumption, etc.
Inverter overclocking is also associated with better solar energy utilization and more efficiency. However, it may not be ideal for all installations, especially if your daily energy requirements are higher than average.
The second inverter sizing method involves installing an inverter with a slightly higher capacity than your 3kw solar panel output capacity. The cardinal reason for going this direction is to give room for future upgrades, say to a 5kw solar array if need be. That said, inverter oversizing is not very common as it does not maximize your solar system’s output regardless of conditions.
Note: Inverter under-sizing or over-sizing should be determined by a trained solar professional for obvious reasons. While solar systems are generally meant to lower energy costs and provide green energy, wrongly sized inverter/panel systems could have the opposite effects and lead to frustrations.
What Is the Best Inverter to Use?
An inverter is the next most crucial component in any solar system. Solar panels produce direct current (DC), which is then converted to alternating current (AC). It’s the alternating current that is then utilized in the house by appliances and other energy-consuming installations. Choosing the right converter comes down to three things; type, sizing, and the manufacturer.
Type of Inverter
There are two main types of inverters to select when installing a 3w solar system, namely:
Microinverters –Microinverters are installed next to each solar module and convert the DC directly from each of the panels at the source. They are ideal for small to medium-sized homes and offices where modularity and power efficiency is the priority.
Standard inverters- Standard inverters usually convert power at a central point merging all the connected arrays.
What Size Battery Will I Need for A 3kw System?
Storing unused solar energy could save you a lot of money in the long run if you can afford a battery. The solar battery size you need may depend on your energy backup needs, daily consumption, and output from your solar modules. For instance, you can go for a 4-battery array with each battery having a 12v/100Amp load capacity if you need at least an hour’s worth of backup power.
In essence, battery sizes vary from customer to customer based on particular energy numbers and needs. Those looking to go completely off-grid may go for bigger battery sizes and arrays to have as much stored energy as possible. Of course, the amount of energy you can store also depends on environmental factors (sunrays) in your area, so having a large battery could make sense in specific conditions.
How Much for An Off-Grid 3kw Solar System?
Building on the previous point regarding off-grid power setups, you will need a significant investment in battery power to achieve an off-grid 3kw solar system. Â For instance, if you went for a 120AH 12 Volt Lithium Battery iTECH120X battery array, a single battery could set you back about $1950. Multiply that by the number of batteries you need for your off-grid system, and you can arrive at a total figure for the entire system.
Generally, off-grid battery setups may end up costing a bit more than the entire 3kw solar installation system, even with average energy consumption. You can go for cheaper flooded lead acid or sealed acid batteries if your energy needs are not that high- e.g., if you only care about lighting.
What Are the Requirements to Install A 3kw System?
There are a few requirements to worry about when you have decided to install a 3kw system. One of the things you need to consider is the roof space you have. As mentioned earlier, a 3kw solar array will need at least 20 square feet of roof space.
At the same time, solar panels in the southern hemisphere- which includes Australia- should be installed facing north for maximum sun exposure. They should also be installed in a position with the most direct sunlight without tree cover or shade from other obstacles such as buildings or tall land features.
All in all, a 3kw solar installation is an excellent investment even if your power bills are not high. It is good for the environment and can save you a lot of money in the long run. Solar installations also increase the value of your home should you choose to sell.