Commercial Solar Panels Cost: What UK Businesses Pay

Cost per kW: the government figures

The Department for Energy Security and Net Zero (DESNZ) publishes the average installed cost of solar PV each year. Its 2025/26 figures for non-domestic installations, published on 28 May 2026 (source):

The figures come from MCS installations, so they stop at 50 kW and include VAT where it applied. DESNZ notes that the cost per kW falls as systems get bigger. They are averages: your price depends on your site.

What sets the price

• System size. Measured in kWp. The size should follow how much power the business uses in daylight, not just how big the roof is.
• The roof or land. Pitched or flat roofs, the fixings or frames each needs, and groundworks and cabling for panels on the ground.
• Access and safety. Scaffolding, edge protection, fragile rooflights and working around a business that stays open.
• Equipment. The panels, inverters, mounting, monitoring and any battery, and the warranties that come with them.
• The grid connection. Larger systems need the local network operator's approval to connect, and some sites need export limitation or upgrades.
• Work on the roof first. If the roof needs repairs, or an asbestos assessment on an older building, that comes before the panels.

Two worked examples

These come from our commercial solar payback calculator, which uses the DESNZ costs above, DESNZ business electricity prices and a published export rate. They are examples, not quotes.

Simple payback is the install cost divided by the first year's saving. It ignores finance costs, inflation and tax relief. The farm's system makes more power but the farm uses well under half of it, so its payback is two years longer: that is why how much you use matters as much as the price.

What decides the saving

A unit of electricity the business uses itself saves what it would have paid for it: 28.6p per kWh for a small business on DESNZ's figures for the second quarter of 2026, including the Climate Change Levy and excluding VAT (source). A unit exported earns an export payment under the Smart Export Guarantee. Ofgem says suppliers set their own SEG rates, which must be above zero (source); our examples use Octopus Energy's published 4.1p (source).

So a unit used on site is worth around seven times a unit exported. A system sized to your daytime use, rather than to fill the roof, usually gives the better return. That is why the installer asks for your bills or half-hourly data.

VAT and tax

HMRC's VAT relief on energy-saving materials covers residential accommodation and buildings used solely for a relevant charitable purpose (Notice 708/6, source). A normal commercial installation is charged at the standard rate, 20% (source). VAT-registered businesses can usually reclaim VAT on business purchases; check with your accountant.

Solar panels count as plant and machinery for capital allowances, which can reduce the tax a business pays on the cost. The rules, with HMRC's own sources, are in our guide to solar panel grants and tax relief for businesses.

Ways to pay

• Buy outright. The business owns the system and keeps all the saving, and may be able to claim capital allowances.
• Finance, hire purchase or leasing. The cost is spread over monthly payments. Who can claim tax relief depends on the type of agreement, so ask your accountant.
• A power purchase agreement. Some installers and funders install and own the system and sell you the electricity it makes, usually over a long contract. Read the contract length, price terms and what happens if you move.

How to get a firm price

Averages tell you the ballpark; a survey tells you the price. Book a free survey and we match your site with one MCS certified installer that covers your area and the size of job. They visit, check the roof or land, the supply and how you use power, and give you a written proposal. Have a recent bill ready, and half-hourly data if your supplier provides it.

When you compare proposals, look at the system size in kWp, the cost per kW, the estimated yearly generation and how much of it the installer expects you to use, the equipment and warranties, and what the price includes. Solar for your sector: farms, warehouses, factories, hotels and offices.