Solar panels for business: the complete UK guide to costs, savings and ROI
Introduction: why businesses are turning to solar
UK businesses have been facing some of the toughest energy market conditions in decades and the situation is not forecast to get any better in the immediate future. Rising electricity prices, volatile wholesale markets, and pressure to cut carbon emissions have made energy one of the biggest line items in a company’s P&L.
That’s why many organisations, from manufacturers to hotels to care providers, are turning to renewable energy with solar panels for business as a proven way to cut costs, stabilise energy bills, and meet sustainability targets.
But while solar can be transformative, the right approach makes all the difference. Choose the wrong funding model, or the wrong installer, and a project that looks profitable on paper can become a financial burden.
This guide cuts through the noise. You’ll learn the real costs, the savings, and the risks plus how to get an independent, unbiased view of whether solar is the right move for your business.
What are commercial solar panels (and how they differ from domestic systems)?
When most people think about solar panels, they picture residential rooftops. But commercial solar is a completely different scale of project.
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System size: business installations typically range from 50kWp to several MW, covering large roof areas or even ground-mounted space.
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Engineering complexity: commercial roofs may have structural challenges, shading issues, or integration needs with existing energy systems.
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Funding options: unlike households, businesses can choose from purchase, lease, or Power Purchase Agreements (PPAs) to finance solar. Finding a suitable way to fund a project can make or break the business case.
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Strategic outcomes: for businesses, solar isn’t about a “nice-to-have” green badge. It’s about reducing operating costs, improving resilience, and delivering measurable ROI.
This is why your solar strategy must be treated as a business investment decision, not just an equipment purchase or tech solution.
The business case: costs, savings and ROI
Solar can offer transformative returns but only if the project is structured the right way.
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Typical costs: a commercial solar installation usually costs between £650–£1,000 per kWp installed (depending on system size, complexity, and location).
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Savings potential: many businesses can offset 20–40% of their annual electricity costs, depending on usage patterns and system size. The potential to vastly outperform the market is achievable with the right approach. When projects are optimised for the client and not for installer profits, the savings potential can be transformative, making significant P&L contribution for the entire service life of the equipment, which can be between 25 and 35 years.
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Payback period: with the right funding structure, businesses can often see payback in 4-7 years, with returns that easily outperform many other forms of capital investment. Optimising the solution is critical here; sub-optimal design and poor choices regarding funding can kill the business case, reduce ROI and significantly lengthen the payback period.
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Lifetime value: solar panels typically last 25+ years, meaning decades of reduced energy costs once the system has paid for itself. Many people that haven’t properly looked into solar for business don’t appreciate the significant lifetime value that be realised. A commercial solar installation can easily generate at least six figures of lifetime savings. The benefits of professionally optimising all aspects of the project shouldn’t be under-estimated in terms of the effect on lifetime savings.
The numbers certainly stack up but they vary widely by business type, funding model, energy profile and how well the project has been optimised. That’s why it’s essential to base your decision on data, not guesswork.
Funding options for businesses
How you pay for solar is often more important than the technical equipment itself. There are three main options for UK companies:
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Outright purchase: you own the system, claim all the savings, and benefit from the highest long-term ROI. But it requires upfront capital so is not a universal choice. In fact the high capital cost of projects is the single biggest barrier to more of these important projects going ahead. Regardless of the fact the project will pay for itself many times over, the upfront cost is unaffordable for many and most organisations favour using capex budgets for more progressive purposes. Historically, many projects have never got off the ground because of this.
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Lease: spread the cost of solar over time. To make commercial sense, the project needs to be structured and designed so that savings outweigh payments, creating a positive cash flow while keeping capital free. With the right structure, this can become an effective route to ownership as well as avoiding use of capex. Read our guide to leasing solar panels here
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Power purchase agreement (PPA): a third party pays for and owns the system. You buy the electricity it generates at a discounted rate, with zero upfront cost. This is a long term model that suits some but not others. The appeal of a PPA is that it’s genuinely zero upfront cost whilst some variants provide certainty of electricity price over the length of the term (often 25 years but can be as short as 15 years and as long as 35 years), regardless of the dynamics of the energy market. Compare PPA and outright purchase in our comparison guide here.
Each model has its advantages and risks. For example, outright purchase maximises ROI but ties up capital. A PPA preserves cash but means giving away long-term savings.
Choosing the right model depends on your objectives: lower bills, stronger balance sheet, or maximised long-term ROI.
Barriers and risks and how to avoid them
Solar isn’t risk-free. Common pitfalls include:
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Roof unsuitability: not all commercial roofs can structurally support solar panels.
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Overpromised savings: installer calculators often assume ideal conditions, overstating returns.
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Funding mismatch: choosing the wrong finance structure can wipe out expected benefits.
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Poor quality installation: without the right expertise, you risk underperforming systems or even compliance issues.
The good news? These risks are avoidable if you have independent guidance that optimises the project in your favour.
WHY MANY BUSINESSES
GET IT WRONG
The most common mistake is choosing based on price alone. Solar isn’t a commodity, it’s a business-critical investment. Businesses that chase the lowest-cost installer often end up with under-performing systems, miss out on better funding options or lock themselves into agreements that benefit the installer, not them.
The difference between a mediocre project and an outstanding one isn’t the hardware, it’s the way the project is structured.
How to get an independent, data-led answer
That’s why we created the Feasibility Kickstarter, the UK’s only solar calculator designed to fully optimise every aspect of renewable energy projects and work in the business owner’s favour. It’s objective is to help our clients objectively validate project feasibility, build the strongest possible business case and ultimately achieve the very best outcomes possible.
Unlike generic calculators, it doesn’t just throw out a cost per kWp. Instead, it analyses your real energy use, compares purchase, lease, and PPA options side by side, calculates realistic ROI, not inflated sales projections, flags risks and shows you how ready your business is.
It’s completely independent. No installer bias. No pressure to choose one option. Just a clear, data-driven view of whether solar is right for you.
The Feasibility Kickstarter is quick and free to use and is your ideal first step to assessing viability and helping to gain support from decision makers in your business. It shows you how to optimise your returns, get the best deals and ultimately maximise the transformative effect renewable energy can have on your bottom line.
Conclusion: is solar right for your business?
Solar panels can deliver transformative savings for UK businesses but only if the project is built around your objectives, not the installer’s sales pitch.
With energy costs rising and sustainability demands growing, now is the time to explore your options.
Before you commit to any installer or funding model, run your numbers through the Feasibility Kickstarter. It’s free, fast, and designed to put your business interests first.
Further resources: see our guides on how to choose the best funding option for maximising lifetime savings
Specialist green finance
Learn what options there are for funding renewable energy projects and how flexible specialist green finance enables projects and supports optimised outcomes.
