Comments: Getting Yourself Into Hot Water?

Some obvious problems:
1. The biggest problem is probably financing the operation: you are tying up the capital and cost of installation for the payoff time. It could work if the cost was cheap, and payoff was short, but if the payoff was over 5 years and it was £2500, I think you'd have a problem. Being below the interest rate provided by banks is a sure-fire way to make sure that the company is not going to be financed. You probably need to be hitting about 10% return per year. Not that much different from the rates on credit cards.

2. Energy users can swtich at any time. What if they switch 1 week after installation. You need a good contract. What if the house is re-possessed? You lose your investment.

3. UK government grants are not likely to pay for it. I think I've heard that they usually get all taken up on the first day that each grant season opens.

I'm not all doom and gloom, but I might be a professional skeptic. There are probably ways to make it work, but I think that the cost of the units and of installation have to come down.


Posted by Jeff Veit at October 29, 2007 08:33 PM
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