How much does Commercial Solar PV cost?

What commercial solar PV actually costs in the UK

Commercial solar is priced per kilowatt-peak of installed capacity, and the single biggest lever on that unit rate is system size. Larger arrays spread the fixed costs of scaffolding, grid application, design and mobilisation across more panels, so the price per kWp falls sharply as the system grows. That is why a small office rooftop and a factory array can differ by half on a per-kWp basis while using the same panels and inverters.

As a working guide for 2026, systems under 100 kW land at roughly £900 to £1,300 per kWp fully installed. Between 100 and 250 kW the rate drops to around £750 to £950 per kWp. Above 500 kW it falls again to roughly £600 to £800 per kWp, and above 1 MW the very largest ground-mount and roof arrays reach around £550 to £700 per kWp. Translated into real projects, a 50 kW office system is in the region of £45,000 to £60,000, a 250 kW warehouse array around £190,000 to £240,000, and a 1 MW factory system roughly £600,000 to £750,000.

Those are ranges, not quotes, and the reason is that a headline per-kWp figure hides a lot of building-specific detail. Roof type, height, condition, the distance from the array to the point of connection, and the DNO's requirements all move the number within the band. The sector cost cards below this section give indicative project values by building type. The rest of this page explains what sits inside those figures, how to fund them, how to read the payback, and where the one-off costs hide.

What a quote includes, and what it does not

A fixed-price commercial proposal from a specialist should cover the whole job, not just the hardware. What you should expect inside the price is the full supply of Tier-1 panels, string or hybrid inverters, mounting and fixings appropriate to your roof, all AC and DC cabling and containment, isolators and protection, the generation meter, commissioning and testing, MCS certification, the G99 grid application, and handover with monitoring set up. A proper quote also carries the PVSyst yield model behind it, so the generation and saving figures are traceable rather than asserted.

What is often outside the base price, and should be called out as a separate line rather than buried, includes any structural strengthening the survey flags, a re-roof or roof repair where the existing covering is near end of life, asbestos survey and removal on pre-2000 roofs, DNO reinforcement charges on constrained networks, and battery storage if you choose to add it. A good proposal prices these as clearly identified provisional or excluded items so you can see the true delivered cost. If a quote looks unusually cheap, the difference is almost always in what has been left out. We set out the full picture, including the honest exclusions, when you request a free no-obligation quote.

Three ways to fund it

There is no single right way to pay for commercial solar. The three mainstream routes suit different balance sheets and tenures, and we model all three side by side with the IRR for each so the decision is made on numbers rather than a pushed option.

Cash purchase with 100% Annual Investment Allowance

Buying outright is usually the lowest lifetime-cost route for a profitable company. Solar PV qualifies as plant and machinery, so 100% Annual Investment Allowance lets you deduct the entire capex from taxable profit in the year of purchase, up to the £1m AIA cap. Most commercial installs sit well below that cap and are fully expensed in year one. On top of that, VAT is reclaimable for VAT-registered businesses, because commercial solar is a standard-rated supply recovered through the normal return, not the 0 per cent relief that applies to domestic installs. Worked example: a £120,000 array bought by a company paying 25 per cent corporation tax attracts roughly £30,000 of tax relief in year one, so the effective net cost is around £90,000, with the input VAT recovered separately.

Asset finance

Asset finance spreads the capex over typically 5 to 7 years and preserves your cash. The structure most businesses use is a hire-purchase or lease agreement where the monthly repayment is set below the monthly electricity bill saving, so the project is cash-flow positive from month one and you own the system at the end. Worked example: that same £120,000 array financed over six years might carry a monthly payment of around £1,900 against a monthly bill saving of roughly £2,400, leaving the business better off each month while it pays the asset down. The capital allowances treatment differs by agreement type, so the tax position is modelled per structure.

Power Purchase Agreement

A PPA needs zero capex. A third-party funder installs, owns and maintains the system, and you buy the power it generates at a fixed rate below the grid price, typically for 15 to 25 years. Worked example: instead of buying grid power at, say, 30p per kWh, you buy the solar output at a contracted 12 to 18p per kWh with a modest annual escalator, banking the difference on every unit generated with nothing on your balance sheet. A PPA suits leased buildings and landlord-tenant splits well, because it can transfer with the building on sale. The trade-off is that the funder, not you, takes the tax reliefs and the long-run upside. We compare all of this against your tenure on our grants and funding routes page.

How to read the payback, properly

Payback is quoted three ways, and they answer different questions. Simple payback is the headline: the installed cost divided by the annual saving, giving the number of years to recover the outlay. For UK commercial solar that is typically 5 to 8 years. It is quick to grasp but crude, because it ignores the time value of money and everything that happens after the system has paid for itself.

Internal rate of return, or IRR, is the number a finance director actually signs off. It expresses the project as an annualised percentage return over the full 25-year life, accounting for the timing of every cash flow, so a well-sited commercial array commonly shows an IRR in the low-to-mid teens, comfortably ahead of most alternative uses of the same capital. Net present value, or NPV, takes the whole stream of savings and export income over 25 years, discounts each year back to today's money at your cost of capital, and nets off the capex to give a single pounds figure of value created. A positive NPV means the project adds value in real terms.

The reason to look past simple payback is that the panels carry a 25-year performance warranty. A system that clears its cost in six or seven years then delivers 15 to 20 years of near-free power, and that long tail is exactly what IRR and NPV capture and simple payback ignores. We give you all three on every proposal, along with the assumptions behind them, and you can stress-test them yourself with our savings calculator.

The hidden and one-off costs

Most disappointing commercial solar experiences trace back to a cost that surfaced after signing. A specialist prices these up front. The ones to watch for are:

• DNO connection charges. Small systems, roughly under 50 kW or 3.68 kW per phase, can use the faster G98/G99 fast-track. Larger arrays need a full G99 application to your Distribution Network Operator, and on a constrained network the DNO may quote reinforcement charges to accept your export. These can range from nominal to substantial, so the application goes in early, before design is finalised, to price the connection accurately.
• Structural survey and strengthening. Roofs over about 1,000 square metres usually need a structural survey for the additional dead load and wind uplift. Where the roof needs strengthening to carry the array, that is a separate cost identified before you commit.
• Scaffolding and access. Tall buildings, restricted access, or a site that needs a mobile elevating work platform rather than a simple tower will carry a higher access cost. It scales with height and complexity, not just system size.
• Re-roof or roof repair. There is no sense mounting a 25-year asset on a roof with five years left in it. If the survey finds the covering near end of life, the honest recommendation is to re-roof first, which is a real cost but one that protects the investment.
• Export limitation. Where the DNO will not accept full export, a G100 export-limitation scheme caps what the system pushes to the grid. It adds a modest control cost but can save a large reinforcement charge and shave months off the connection timeline, so it is frequently the cheaper overall route.

None of these apply to every building. The point is that a credible proposal surveys for them and prices them openly, rather than quoting a clean per-kWp rate and issuing variations later.

What drives the price up or down

Beyond size, the main variables are the roof and the connection. A large, unshaded, single-plane steel-portal warehouse roof with a nearby point of connection is the cheapest canvas in commercial solar; a small, cluttered, multi-plane office roof with parapets, plant and shading is the most expensive per kWp. Mounting type matters too: non-penetrative clip-fix on standing-seam metal is efficient, while ballasted flat-roof systems and older fibre-cement roofs carry more labour and more survey work.

The point of connection distance, the choice between string and hybrid inverters, whether battery storage is included, panel and inverter tier, and the DNO's specific requirements all move the number within the band. Ground-mount and solar carports change the economics again where roof area is short of demand. This is why we size and price from your half-hourly meter data and roof drawings rather than a per-square-metre estimate, and why two buildings of the same size can quote quite differently.

Timeline and cash-flow profile

From signed contract to a commissioned, exporting system is typically 8 to 20 weeks. The physical install is only 1 to 6 weeks of that depending on size; the critical path is almost always the DNO connection, which runs 4 to 12 weeks for smaller systems and up to 18 months for the largest. Submitting the grid application early, usually before the site survey, is the single biggest lever on the overall timeline. The rough sequence is feasibility and desk model, G99 application, structural and site survey, design freeze, install, DNO witness and commissioning, then handover with monitoring live.

The cash-flow profile depends entirely on the funding route. On a cash purchase, the outlay lands up front, the year-one tax relief follows in the next corporation-tax computation, and the savings then accrue every month for 25 years. On asset finance or a PPA there is little or no up-front cost and the position is broadly cash-flow neutral to positive from the first month, because the finance payment or contracted solar rate is set below the bill saving it replaces. Either way, once the system is paid down the saving becomes close to pure margin for the remaining life of the array.

How it compares to grid electricity

The whole case rests on this comparison. UK commercial electricity contracts now sit at roughly 25 to 45p per kWh, around double the rate of three years ago, and that price is exposed to wholesale volatility every time a contract renews. Solar you generate and use on site costs nothing per unit once the system is paid for, and even before payback the levelised cost of your own generation over the array's life is well under half a typical commercial grid tariff.

Every unit you self-consume displaces a unit you would otherwise buy at that 25 to 45p, which is where the value is won. Every surplus unit you export earns the Smart Export Guarantee rate instead, roughly 4 to 15p per kWh, so the design goal is always to keep self-consumption high rather than to fill the roof. A daytime-occupied commercial building typically self-consumes 55 to 75 per cent of its generation without a battery, and storage lifts that to 80 to 95 per cent where evening or overnight load justifies it.

Because it displaces a rising, volatile cost with a fixed, owned one, an array is best understood as a 25-year hedge against grid prices rather than a simple bill discount. The more grid electricity costs in future, the more each self-generated unit is worth. To see how the numbers land for your specific building, sector and roof, start with a desk feasibility from your meter data, or read our worked sector breakdowns on the solar for warehouses and industrial units and factory and manufacturing solar pages, where continuous demand pushes payback to the lower end of the range.