Hey team, it's Francis.

Well, my chat about solar power and electric vehicles was more popular than I thought.

It seems that the oil crisis has got a lot of us making some hard decisions and yeah, it's that kind of situation, isn't it?

TVNZ Breakfast also wanted to have a chat about it, so I ran some really rough numbers to help you do some back of the envelope calculations on whether solar could also work for you and they said I could also put that conversation here for you, so hope it helps.

Look, there were lots of questions after the previous solar power electric vehicle episode, so I'm going to do a deep dive on all of those issues in my newsletter.

I think that'll be an easier format to dive into some of those details for you.

If you want to read that when it comes out, head to Francisco Co NZ Invest and put your email address in there.

I'll put the link in the show notes of this episode too.

Anyway, enjoy.

Power prices are climbing.

Petrol costs are soaring.

And for many Kiwis it's getting harder to figure out where to make any savings at all.

But some households are taking a different approach, investing in things like solar panels and electric vehicles to try and cut costs in the long run.

So could these strategies actually work for you and your family?

Let's bring in independent financial journalist Frances Cook.

Morina.

Francis, I know you've got firsthand experience with a lot of things we're talking about today, which is wonderful.

Let's start with solar panels.

Who is a good candidate for investing in something like solar?

Yeah, and it's as you say, those power prices going through the roof, the fuel costs, insane.

So if you're looking at.

Apparently the average New Zealand household Now spends about $200 a month on their electricity.

That is old stats.

It will be more than that by now.

So a little rule of thumb is if you're spending more than 180amonth, then solar could help bring your power prices down.

The trick is this is another one where it works best for homeowners because you have to be in that house for the long term for it to be giving you a cost saving over a long period of time.

Yeah.

So not only a homeowner, but you really do intend to stay in that property for quite some time.

So what would be the initial outlay to say getting them on your ceiling on your roof?

Sorry.

Yeah, well, so the average install is 16,500 in New Zealand.

So that is quite a bit.

You can get it less.

It depends if you have a north facing roof, then you can often get more power coming in and really good generation.

And then as well, if you can access something like a green loan.

It makes it a little cheap here, but you really want to be thinking about, I'm going to be here for a long time, I've got a good north facing roof and that 16,500 is a lot.

Have a little look at your power bill for the year.

Divide the 16,500 by your yearly power bill.

That gives you a really rough back of the envelope calculation on how long it would take for you to pay back.

And then your average solar system can last sort of 20 to 25 years.

So it's like, okay, if this is going to take me eight years to pay off, then I've got another maybe 15 to 20 years of free power, then that's looking pretty good.

But you do want to be sticking with it long term.

You have to stick with it long term.

And I think that might be scary for some people because they might not necessarily want to lock in for something that long.

But I mean, the people that did it 10 years ago are, you know, laughing right now, aren't they?

And in terms of EVs, obviously we know these are selling like hotcakes around the country right now.

Who might be a good person to consider an ev?

I mean, do they work for everyone?

Yeah.

So the big thing that you often end up paying for if you've got an electric car is range.

And that's how long your battery lasts before you need to charge it up again.

If you're just, you know, tootling around Auckland or Wellington and you don't really go on many road trips, you're not on the road for work much, then it's not so bad.

You don't need much range.

You could probably get away with a little secondhand Nissan Leaf, whatever.

Yes.

If you are someone like me who drives a lot for work, then you might need to spend more on a car that has bigger battery, bigger range.

But if you are already doing something like the solar, then it's potentially worth considering.

How much can you stack up here?

It's not that much of an extra investment.

If you can get a cheaper install and a cheaper secondhand electric car, you might be looking at $20,000 tops, which at that point, yes, that's a lot of money.

But if you can finance it right then it's sort of looking like a bit of an investment in the future.

And you quickly mentioned green loans just a moment ago.

Tell us more about that because I'm not sure everyone actually knows that these even exist.

Do all banks offer them and how do they work?

Yeah, so this is a thing that takes it from who has $20,000 to invest in this to oh, this might actually work.

Pretty much all the major banks have these green loans where you can access sort of 0 to 1% interest rate.

You do have to pay it back faster.

It's sort of three to five years.

It's all depending on your bank.

But then when you're doing it like that, with money that is really very cheap, then it makes it easier to get the capital and then get those savings.

Direct your former power bill spending to paying that off, then you're looking a lot better.

Home and host.

Home and host.

How long, I mean, how easy it is to get these green lights?

Yeah, it's tricky, right, because this is another one of those things where if you own a home and you've got a mortgage, then it becomes so much easier and it is a little tricky on that front.

But I do still think, you know, if we're looking at an oil crisis like this where we're saying, well, hey, we're needing to get some pressure off our fuel supplies, we need fewer people using petrol, more people electric.

Even if we're saying we're getting some more electric cars into the system, then that all helps.

So I know it can feel a little frustrating if people aren't a homeowner or they're not staying there for long, but still getting the stuff into the system and starting to change, that can have flow on effects that make it a little easier for everyone.

Well, thank you so much for your sage advice as always, Frances Kirk.

Appreciate you coming in.

This podcast can only give you general information about how things work in most situations.

It's not individual financial advice.

If you're after that, a financial advisor is always the best bet.