Solar Panel Funding Options for UK Businesses
Your commercial solar journey starts with funding. Whether you choose to self-fund or take advantage of financial support, Perfect Sense Energy can help you transition to solar-powered renewable electricity in a way that makes sense for your organisation.
16 Years +
Of Experience
1432 GWh+
of free power generated
40 MWp
296,000 Tonnes
of CO2 Savings
360 +
Live Commercial PV Installations
£130 m+
in client savings produced
If your business is considering installing solar panels but is put off by the upfront cost, we have good news.
Many solar panel funding options available can help you to spread the finance, receive tax relief, or even get grants towards the expense.
Not every scheme is permanent, so make sure to take advantage of them while you can.
Contact us at Perfect Sense Energy to understand your available options.
Solar Panel Grants and Funding
Some renewable energy solar installation options help fund the installation directly, while others reduce the overall cost or help improve your return on investment (ROI) over time.
Purchase outright
Capital expenditure (CapEx) is one of the better-known options for financing solar panels. This means treating solar panels as a long-term asset and using upfront business investment to fund it accordingly. This route gives your business full ownership of the system from day one, which means you keep the long-term energy savings and get a stronger ROI.
However, it does mean taking on the cost of the installation directly, whether as a single upfront payment or through staged project payments. For this reason, it tends to suit businesses with capital available and predictable expenses.
Solar panel grants
Some grants cover solar directly, while others support wider energy efficiency or decarbonisation projects where solar forms part of the work.
There is no single UK-wide solar panel grant for every business, so it is worth checking official grant directories, local authority schemes, and regional business support programmes. Ofgem and Great British Energy both signpost businesses to current energy efficiency and green funding schemes.
Power Purchase Agreement (PPA)
In a PPA, a third-party organisation funds, insures, and maintains the solar panels installed on your site.
Your business does not own the solar panel system but pays the third-party provider directly for the energy, typically benefiting from 40-60% lower electricity bills than if you relied on the national grid.
| Annual Investment Allowance (AIA) | For qualifying plant and machinery costs up to £1 million. |
| First-year allowances (FYAs) | 100% tax relief on specific business equipment, such as EV charging. |
| Writing-down allowances (WDAs) | 6% tax relief for solar panel installation. |
| Structures and Buildings Allowance (SBA) | For some construction, renovation or conversion costs for non-residential buildings. |
Capital allowances
For capital allowance purposes, HMRC treats solar panels as special rate plant and machinery, which means your business may be able to claim tax relief on qualifying solar PV costs.
This allows you to deduct some or all of the cost of solar business assets from your profits before tax.
Green loans
Depending on the region in which your organisation is located, you may be eligible for a green loan to fund the cost of installing solar panels.
Some schemes are regional, such as those in Scotland and Wales, while commercial lenders and British Business Bank-backed finance options are available more widely across the UK.
| Barclays Green Loans for Business | Businesses can borrow from £25,001 and may receive an interest rate discount of up to 0.3% for eligible green assets. |
| HSBC Go Greener SME Reward | £25,001-£300,000 loan value for UK small-to-medium-sized businesses (SMEs) for solar panels and batteries. |
| Lloyds Clean Growth Financing Initiative | For a variety of different businesses that want to reduce carbon emissions. |
| Growth Guarantee Scheme | Novuna is partnering with the British Business Bank on a green asset finance variant of the Growth Guarantee Scheme, covering assets such as solar PV, battery storage, heat pumps, wind turbines and EV chargers. |
Smart Export Guarantee (SEG)
The SEG is a scheme that allows you to sell any excess energy your solar panel system produces back to the national grid. While it isn’t an upfront funding option, it does have the potential to help you pay off solar panel expenses more quickly, thereby increasing your return on investment.
To qualify, your system cannot have a greater installed capacity than 5 MW, and it must also have a meter that can send export readings once every half hour. To apply, you must connect directly with an SEG supplier. This does not need to be the same as your current energy supplier.
See What Solar Panel Funding Is Available for Your Business
We get that every business has unique requirements, so if you need greater clarity on what’s right for you, feel free to reach out to a member of our expert team at Perfect Sense Energy.
We can walk you through how much a solar photovoltaic (PV) system is likely to cost your business and what funding options will be the best fit. As a solar panel installer with 15+ years of experience, you can trust that you are in safe hands. Contact us today.
FAQs
How do I choose the right funding for my business?
The right solar panel funding option will depend on the nature and size of your business, as these will determine eligibility and appropriateness for how you finance solar panel installation. It is also possible to combine more than one funding option. Whichever option you go for, solar power is a fantastic way to improve energy efficiency measures, lower energy bills, and reduce your business’s carbon footprint.
Is it better to pay cash or arrange solar energy finance for commercial solar panels?
It depends on the needs of your business. While paying for your solar PV system at the time of installation lets you avoid paying interest (reducing the overall cost), spreading the cost through monthly payments also has advantages. You could also opt for a PPA, meaning your business pays no upfront costs.
What is the ROI for commercial solar panels?
The average ROI of commercial solar panels installed by Perfect Sense Energy is 3-4 years.
