This Month's Top 10 Share Ideas (Jul 11)

Whilst it is not a share deal and no one makes any money from it except the investor, the government incentive for renewable generation of electricity offers 10% or more per annum guaranteed for 25 years. It will vary upwards by the rate electricity prices rise, by the RPI (it's index linked) and it's tax free, regardles of your personal tax situation.

The best fixed ISAs at present are offering 3.75% in return for not withdrawing cash for at least 5 years. Last year's increase in the RPI was 4.8% and whether the "proceeds" from ISAs are tax free or not, that equates to a 1.05% loss in value in one of those years alone. Normal savings accounts are losing approx. 3% per annum at present and whilst you cannot take a solar panel off the roof and cash it at the bank if you run short, providing you intend not to touch the amount used to invest in the solar pv system, it will be returned over approx. 8 years with 100% tax free profit for the remaining guaranteed 17 years left on the scheme. Higher rate tax payers will benefit by up to 18% per annum.

BATS divvies up 15% today. Kerching.

@Jimi97 Agreed. There was an article on Citywire about this renewable stuff. Some of it was like a 50-year payback. It makes no economic sense. The very fact that the government has to dole out money for these schemes is clear proof of that; in my eyes, anyway.

A lot of this stuff is predicated on governments being especially generous with the FiTs (Feed-in Tarriffs). Government policy is so fickle. One simply can't rely on it.

Do you receive any guarantees with any other types of investment? If you do, it is certainly not a figure which is the best return possible and not many will even offer any sort of guarantee least of all 10% or more per annum. The FIT is on the statute books it is legislation through parliament and complies with the EU. All political parties have worked on it, it was launched by the labour government and has been endorsed by this government. There are rules in place whereby the current terms will last only until April 2012 when they will reduce the tariff, but not for existing investors. Subsequent years will also see reductions and possibly the terms will change for new joiners of the scheme. The best part of this incentive is once you are on the scheme, the terms will not change, but if you wait too long you will miss the best terms. Share prices change everyday so that should not be difficult for most investors out there to understand.

Also, the scheme is not being paid for by the government, although they guarantee it for 25 years and offer the suppliers a levelisation process, it is the consumer who will pay and is paying right now.

The choice is simple, invest in solar now, using money which will eventually have to be paid out on future electricity bills to suppliers and receive over 10% per annum return, tax free, index linked and a guaranteed net profit of on average of £40,000 over the next 25 years, or do nothing, spend around £40,000 on average on electricity bills and have nothing to show for it.

The manufacturers give a 25 year performance guarantee on the output of the panels and most companies offer their own and an independent insurance warranty to back up their own guarantees should they not be able to honour them in the future.

Suppliers and installers already back up their claims to the returns available by being members of the REA and by being approved by MCS both consumer focussed government regulators. The data used to estimate the return is government issued and is very much underestimated rather than exaggerated. Unless the installer is registered and approved by the above, the installations will not qualify for the incentive.

You can see your investment on the roof and do not have to worry what your bank or other organisation is doing with it and we all know how good some of them are at that! And, how good they are at paying interest which is not even keeping up with inflation.

Do nothing now, and as a colleague of mine says, be ready to go to Bristol if you live in the SE, as that is where the queue will start once the masses realise the implications of the FIT scheme and what it is worth to them!