Solar PV – Is excess generation a waste?

When choosing to put solar panels on your roof, what is a good basis for determining the appropriate capacity? And is generating more than you use a waste?


Richard Keech

When anyone gets solar panels installed on their roof they need to choose the appropriate system capacity. So just how much is enough? Is getting more than your own immediate needs a waste?


Set your own goals when buying solar PV for your roof. I think a reasonable goal for home solar PV is to minimise the number of daytime hours every year when you’re not generating sufficient solar to cover your demand. Put another way, the goal is to maximise your own generation when there’s not much other solar energy on the grid, i.e, when it’s overcast, or when the sun is close to the horizon. Doing this is going to lead to annual generation potential which is well in excess of your consumption. Curtailment of generation, at times, is likely to be necessary, but this is not a bad thing.

Net-energy neutral

One possible basis for choosing a PV system size is to have the new system’s annual energy generation match the premises’ annual energy consumption. An arrangement like this can be said to be net-energy neutral. So generating more than the underlying annual consumption is net-energy positive. Being net-energy neutral (or better) is good. It means that you’re offsetting your entire annual consumption.

Yield estimation

How much solar will make you net-energy neutral? When you get a quote for your solar, you should be given an estimate of the annual yield in kilowatt hours. Compare this with one entire year of (pre-solar) electricity consumption from your bills. As a rule of thumb, to estimate output, you can use solar capacity factor (CF) for your location, along with this formula:

Yield [kWh/annum] = PV Capacity [kW] * CF * 8760 [h/annum]

For un-shaded, well-oriented solar panels, indicative capacity factors to use are shown in the table below

LocationPV Capacity factor
PV capacity factor for Australian major cities

Generating more

So, net-energy neutral is good, but is generating more a waste?

One line of argument goes that generating more than you need amounts to excess consumerism and over panelling, and that excess generation just contributes to future e-waste.

Is this true? Short answer – no.

We still have a way to go before we have too much solar capacity connected to the grid. What a house doesn’t use offsets the consumption by the neighbours. Also, going big on solar reduces the number of hours when you have insufficient generation to cover your load. This helps you deal with the winter problem, outlined below.

The excess generation fallacy

There’s a fundamental fallacy in the idea that having generating capacity in excess of that needed to offset annual consumption amounts to waste.

What waste? At present, surplus rooftop generation is mostly not wasted. Although surplus to the premises, it’s not necessarily surplus to the grid. One premises’ surplus is generally used in other premises and business on the grid, or contribute to ‘charging up’ grid-level storage such as pumped hydro and big batteries.

Yes, there may be other times when total solar generation is in excess of the instantaneous power that’s needed. This causes the spot price of electricity to drop to very low or negative. However, that’s a good problem to have, and it’s manageable. New PV installations in South Australia and Western Australia are fitted with provision for external curtailment, i.e., the grid operators can centrally turn off solar systems when generation is too high.

The winter problem

It’s critical that an energy system matches demand with supply. When it comes to our homes, for those of us in temperate and cool climates, there’s a mis-match. Seasonally, our solar generating capacity is the least when our demand is the greatest. This means that the hypothetical value of a unit of energy generated during the worst-case week in winter, is a lot greater than the value of the same amount of energy generated a good solar week in summer. This large difference drives the incentives towards scaling the system to generate more in winter, even if that means more surplus in summer. The fact that the unit cost of solar PV energy is very low, means that it becomes economically rational to deliberately scale our generation such that a lot will be surplus in summer, so that there is more available in winter.

What is the goal? In the past, people have talked about solar power as if it has the goal of maximising annual generated energy. However, I think that a good way to think about the goals of solar (indeed any generation) is that you want to maximise the number of hours with sufficient generating power. So, we shouldn’t be thinking of the problem in terms of energy. It’s more useful to think in terms of achievable power.

Rightsizing for challenging conditions. The way our society plans infrastructure already tries to allow for sufficient capacity all year round. Imagine if we sized our road system to cope with average demand. It would not cope when conditions are challenging, i.e., in peak hour. We don’t drive on a freeway at night and say ‘most of these lanes are a waste’. We know that they serve peak hour. Likewise, we shouldn’t look at large solar systems and say ‘most of these panels are a waste’, because they serve us better in winter.


A solar PV installation with quality parts, and properly installed, should last a very long time. It’s reasonable to expect at least twenty years from a solar array. Here’s a report of a forty-year-old solar panel still working fine.

If we can expect a long service life from a solar panel, then the case is stronger that sizing solar generously is not going to be a waste.

Panel direction

We’ve traditionally wanted to point fixed solar arrays to the north to maximise annual yield. However, if our goal is to maximise generation at times of low solar potential, then we need to recognise that a south-facing panel will work just as well as a north-facing panel when it’s overcast. Also, south-facing panels generate better than north-facing panels when the sun is close to the horizon in summer.

So, cheap panels, and an imperative to generate for more hours of the year should lead us to configure solar arrays to utilise more of our roofs, even if that means pointing panels in unconventional directions.

Other Reading

Jonathan Prendergast, 2017, “Go Big: Six reasons why you should be a rooftop solar champion“, Reneweconomy.

(for a alternative view) Greg O’Grady, 2022, “SHOULD I FILL MY ROOF WITH SOLAR PANELS?“, MEEH.