What is the Cost Range for Commercial Solar Panels?

The investment for a commercial solar panel system in a small to medium-sized business typically ranges from £16,000 to £70,000.

The size and cost of commercial solar panel systems can increase, depending on the roof space available and the specific energy requirements of the business.

The total cost is influenced by factors such as the energy consumption needs of the business and the efficiency of the solar panels chosen.

Before deciding on solar panels, it's important to assess if they are a suitable option for your business. Analyzing your utility bills can provide insights into your energy usage and the cost per kilowatt.

In the UK, the average medium-sized business consumes between 30,000 and 50,000 kilowatt hours (kWh) of electricity annually, while small businesses use about 15,000 to 30,000 kWh.

The cost for a commercial solar panel system is approximately £1,000 per kilowatt.

Below is a table that outlines various sizes of commercial solar panel systems and their corresponding typical costs.

Are There Financial Grants for Businesses to Install Solar Panels?

Currently, there are no universal government grants available for businesses seeking to install commercial solar panels, and there are no indications of such grants being introduced in the near future.

However, the government does provide regional-specific grants. For instance, the Low Carbon Workspaces grant offers financial support to businesses in areas like Buckinghamshire, Berkshire, Hertfordshire, Northamptonshire, Bedfordshire, Luton, and Milton Keynes, offering up to £5,000 for adopting energy-efficient measures, including solar panels.

In Dorset, the Low Carbon Dorset program offers even more substantial support, with grants covering up to 40% of project costs, ranging from £5,000 to £250,000.

Additionally, businesses that install commercial solar panels can benefit from tax advantages through capital allowances.

How Long Until Businesses Recoup Their Investment in Solar Panels? 

On average, the payback period for solar panels is about 12.9 years, but this timeframe is often shorter for businesses. This is because businesses typically operate during daylight hours, allowing them to make optimal use of the solar-generated electricity.

In contrast, residential solar panel systems may not utilize the electricity as efficiently during peak sunlight hours, leading to a longer payback period.

Businesses can further reduce their payback period by participating in the Smart Export Guarantee (SEG), which allows them to sell excess energy (up to 5 megawatts) back to the UK’s National Grid. SEG tariffs typically offer between 3.5 and 15p per kilowatt hour (kWh), providing an additional, albeit modest, revenue stream.

What Financing Options Are Available for Commercial Solar Panels? 

Power Purchase Agreements (PPAs) are a popular financing option for businesses looking to adopt solar power without the initial capital expenditure. Under a PPA, a business can rent its roof space and purchase solar electricity at a discounted rate, without owning the solar system.

This arrangement allows businesses to enjoy the benefits of solar power, including cost savings, without the need for a large upfront investment. Additionally, PPAs often include an option for businesses to purchase the solar system later on.

Many PPAs also offer the solar system to the business at no additional cost after a 25-year period. While older solar panel models have a lifespan of 25–30 years, newer versions can last for 40–50 years, making this a potentially attractive long-term investment.

Determining the Number of Solar Panels Your Business Requires 

A typical medium-sized business, consuming around 37,500 kWh annually, would require approximately 142 solar panels, covering an area of 284 square meters (m2) on the roof.

For most small businesses, with an average annual consumption of 22,500 kWh, around 84 solar panels would be needed, occupying about 168m2 of roof space.

The exact number of solar panels your business needs will vary based on the size of your business and its energy demands. The requirements for a small or medium-sized enterprise (SME) will differ from those of a larger office building.

Additionally, the type of business influences energy usage. For instance, a law firm typically consumes less energy than an industrial facility, so their solar power needs would differ even if the buildings are of similar size.

To estimate the size of the solar system you might need, consider:

• Your electricity usage.
• Local sunlight (i.e., daylight hours).
• The size of your roof.

Requirements for Installing Commercial Solar Panels 

Provided there is sufficient roof space, most businesses can install solar panels on their buildings without much difficulty.

Alternatively, setting up a solar farm is an option, though this requires local council approval. Approval for a large-scale commercial solar system depends on factors such as:

• The visual impact of the solar system.
• The benefits it brings to the local community.
• Its impact on the local ecosystem.
• Local electricity grid capacity to support the solar system.

Do You Need Planning Permission for Commercial Solar Panels? 

Many businesses fall under Permitted Development Rights, allowing them to install roof-mounted solar panels without significant restrictions, regardless of size.

However, installing a ground-mounted solar system is more complex. Any system larger than nine square meters requires planning permission.

For ground installations smaller than nine square meters, the following conditions apply to avoid planning permission:

• The solar array must not exceed four meters in height.
• It must be installed at least five meters away from the property boundary.
• In conservation areas or world heritage sites, the solar array should not face or be visible from a highway.

As with any development potentially requiring planning permission, it's always best to verify and obtain approval before proceeding with the installation.

Should Your Business Consider Solar Panels? 

Solar panels are increasingly becoming a preferred choice for energy generation among UK businesses. They not only offer significant savings on energy costs but also position your business as an environmentally conscious leader.

Given that most businesses operate during daylight hours, transitioning to solar energy is a financially prudent decision. For businesses active at night, integrating solar panels with solar batteries can provide continuous power, even after sunset.

With renewable energy gaining a larger share in the UK's energy mix, the trend towards solar adoption is growing. Embracing solar panels now can place your business at the forefront of this shift.

Before investing in commercial solar panels, consider these questions:

• Are my current energy bills excessively high?
• Can I manage the initial investment cost?
• Is leasing a solar panel system a viable option for me?
• Would a Power Purchase Agreement suit my business needs?
• Will adopting green energy positively impact my business's reputation?

The Growing Popularity of Commercial Solar Panels for Energy in the UK 

The trend of commercial solar panel adoption is on the rise in the UK, with major companies like Tesco leading the way. Tesco collaborated with EDF Energy to install 5 megawatts (MW) of solar capacity across 14 stores, involving over 15,000 solar panels. In the first year, these panels generated about 4,235 MWh, potentially saving Tesco over £675,000 in energy costs and reducing CO2 emissions by more than 1,000 tonnes. Solar systems.

Another notable example is Novatech, one of the UK's leading computer product retailers. Partnering with Infinity Energy, the Portsmouth-based company installed a 404.3 kWp solar panel system, projected to save £21,000 annually on energy bills.

Infinity Energy estimates that the installation will yield a profit of £1,101,356 over 20 years for Novatech, with the system paying for itself in just 6.4 years.