ALTERNATIVE forms of heating are in the news. Ferroli is one of the latest companies to launch solar technology, hard on the heels of Valliant.
But one of the questions which always crops up is how long it will take to recoup the capital cost. Payback seemed a simple equation.

It is the capital cost divided by the savings in the cost of running the appliance per year. For example, if the cost of a solar installation is £3000 and it saves £200 a year on a gas bill, then the pay back period is 15 years.

But Stewart Purchase, managing director of Viessmann, believes a new German study has turned this simple calculation on its head.

Stewart has no particular axe to grind as Viessmann offers all of the alternative energy sources in its portfolio.

The study used a detached family four-bedroomed house of 140m2 built in 1980. It did not include labour. It was heated by oil/gas and the conventional boiler was 25 years old so it was near the age when the householder had to think of a replacement.

Dearest in capital cost was a ground source heat pump which cost about £15,000 but saved about 58% of energy. Nevertheless it would take 15.2 years to repay the cost. Next came an air/water heat pump which saved 50% of energy costs but took 14.3 years to pay back the cost.

Biomass (wood pellets) cost about £6,500 and saves about 40% so that would only take 10 years to repay. A condensing gas/oil boiler would have cost nearly £3000, save £28% and the payback would be 5.9 years.

Solar panels would cost about £1000, save 6% and payback would be 9.3 years.

Stewart reckoned the best deal was a combination of a condensing boiler and solar panels. But, and there are, according to Stewart, several, the boiler was coming to the end of its natural life and it would have needed replacing anyway.

If the boiler had been replaced by a condensing boiler, then it would have cost £3000 anyway so the outlay would be neutral.

So it seems to me that any form of heating could be discounted by the cost of a condensing boiler. Plus, if the householder went to the cost of replacing the old boiler with a ground source heat pump or an air/water heat pump, then how much would this put on the resale value of the house?

Any estate agent worth his salt would try to raise the selling price especially when he (or she) could offer such energy savings. Say, for instance, that £2000 or even £5000 would be added to the value, then the cost of the air/water heat pump instead of being would come down from £12000 would come down to a more reasonable £4000 (the cost of the condensing boiler and the gain in the house price).

A house needs constant renewal. What is the payback on a new front door? Or a new pair of curtains or a new car or double glazing?

So the figures are far from cut and dried. In the end it comes down to what householders want and what they will be prepared to pay.

Someone said to me recently that few would buy solar panels if they did not intend to stay in a house longer than the payback period. Yes, but the German study offers payback in different ways. Has a house with solar panels on the roof become more saleable than one without – and what is the premium?

Paul Braithwaite, Editor