Should your Business Invest in Solar Panels in 2020

business solar panels

You may be asking yourself whether it would be worth your business investing in solar panels. If you have an empty roof space, want to reduce your carbon footprint and save money on your energy bills it would be well worth spending some of your time investigating the options open to you.

Whether your business is large or small there are compelling reasons to invest in solar energy. As the cost of energy rises putting your roof space to good use can be a sensible decision for your business. Many commercial organisations have already realised the big savings that can be made from installing solar panels to supply your business with electricity. All you have to do is utilise the roof space on your commercial premises, agricultural buildings, factories, warehouses, schools or hospitals, and install solar power generators to start generating solar energy.

Commercial solar panels can make a real difference to your business by generating free, green electricity during daytime hours that can be used on site, lowering your business demand for energy from the grid and potentially saving thousands of pounds on energy bills. Ideally you would use all the solar power onsite, however any surplus power can be sold to the grid which has the added bonus of generating extra income. For larger business solar panel and commercial rooftop installations you can achieve a reasonable return on investment, despite the Feed in Tariff coming to an end, particularly if you consume a significant amount of electricity during daylight hours. What’s more, solar panels have no moving parts, so ongoing maintenance costs are minimal. High users of generated electricity will benefit the most. Solar PV is in fact a reliable and safe investment vehicle that provides returns exceeding those of traditional low risk financial products.

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With energy prices predicted to sharply rise in the next 10 years purchasing commercial solar panels can make financial forecasting much easier by allowing you to effectively forward buy your electricity at a set price. Installing solar panels stabilises your electricity supply and can reduce cooling overheads in the summer.

Another important point to consider is your energy security. The National Grid is currently struggling to generate considerable electricity supply to meet the UK’s growing energy demands. At the same time the government has introduced mandatory energy audits for large businesses via the Energy Savings Opportunity Scheme (ESOS) and are considering future energy usage regulation, making independent solar installations an excellent backup measure.

By taking your Business’s energy solution into your own hands and generating your own solar energy you will emit less CO2 into the atmosphere, reducing your carbon footprint considerably as well as increasing your company’s sustainable credentials and improving your business reputation. Solar panels are a fantastic way of displaying your green values in a prominent and public-facing way.

If you are looking at installing a large-scale commercial solar panel PV array such as a solar field, you will require planning approval from the local authority. The final planning decision will be based on a number of different factors including visual impact (glare, etc.), the potential benefits it could bring to the local community, the array’s impact on the local ecosystem, as well as the local electricity grid connectivity. There will be a planning application fee, usually dependent on the size of the proposed site, each local authority will have its own guidelines on this. The LA will also conduct a site visit when assessing a planning application, as well as gauging the local reaction to the proposals.

Planning permission will also be required if your solar PV system is intended for installation on a listed building or a site designated as a scheduled ancient monument or world heritage site.

Due to advancements in technology the cost of solar panels has plummeted in the last 10 years. The type of solar panel system that you require will depend on the size of the commercial business which will determine the range of wattage and price.

The most popular systems for businesses have a 5-9kW output but a commercial operation with large spaces of land may require a system with an output of 25kW to even as much as 200kW.

A minimum upfront investment of around £10,000 is required for a small commercial system to cover the supply and installation of solar panels, inverter, isolators, cabling, relevant testing, certification and registering with regulatory bodies and your electricity company.

You may choose not to invest capital and there are various different funding options available. If your business qualifies you may even be eligible for free commercial solar panels. Renewable Energy Hub can help you look at what is available.

Some energy suppliers may offer power purchase agreements (PPAs) to businesses who meet qualifying criteria. With this type of agreement, solar panels are installed on your roof at no cost to your business, while the electricity generated is purchased back from the funder at a rate that is substantially cheaper than that offered by your existing supplier, saving you thousands of pounds in electricity bills.

Bearing in mind the high upfront cost involved especially in the case of large-scale solar projects, the feasibility, development and planning processes for large-scale solar projects are usually lengthy and very detailed. Substantial building or landscaping work may also be required.  As with any other solar PV installation, in order for a site to be suitable it must usually meet certain conditions, such as:

  • few obstacles (trees, hills, buildings, etc) which could cause shading issues and reduce the output of the array
  • flat or south sloping ground is optimal
  • there must be access for initial construction and regular maintenance
  • some PV developers may set a minimum area of land for it to be financially viable
  • there must be a local connection to the electricity grid
  • the proposed site must not be susceptible to floods
  • planning permission is unlikely to be granted for proposed sites located in protected areas
  • there must be a local connection to the electricity grid

Deciding to go solar isn’t a decision you make in a day. Indeed, it certainly shouldn’t be done without thorough evaluation and careful assessment of both the pros and cons.

In most cases, the benefits of going solar far outweigh the drawbacks and understanding both will help you make wiser, more confident choices for your business.

Find out more about solar here. 

New Smart Export Guarantee Replaces Scrapped Feed-in Tariff

Smart Export Guarantee


The Feed-In Tariff scheme which was launched in April 2010 closed for new customers at the end of March this year. Those with existing contracts are not affected and continue to be paid. Under the Feed-In Tariff scheme there were two payments, a “generation tariff” and an “export tariff”.

The “generation tariff” paid for all the electricity that a household generated. Rates were set by the government and depended on the size of your solar PV system and when you signed up to the scheme.

In the early years rates were much higher – some paid more than 50p per kilowatt hour but were cut over the years and fell to around 4p for new customers by March this year. Once you had secured a rate it was fixed for the life of your contract, typically 20 or 25 years.

The “export tariff” paid homeowners for the surplus energy they exported to the grid. Rates were fixed by government for the entire contract term and were around the market rate for electricity. It was 3.82p/kWh until August 2012 and then 5.38p until the Feed-In Tariff scheme ended. Under the Feed-In Tariff all households were paid the same rate which was 50% of all the energy generated by the solar panels. The actual amount exported to the grid was not measured, so everyone got this regardless of how much electricity they exported.

Though the Feed-In tariff has come to an end, some of the excess electric generated by your solar energy will inevitably go back to the grid and as under current legislation it would be illegal not to be paid for this a new system had to be devised. This is where the Smart Export Guarantee comes in to play.

So, what is the Smart Export Guarantee? Final proposals for the Smart Export Guarantee were published by the government on Monday, 10th June 2019. The Smart Export Guarantee requires medium – large electricity supply companies including SSE, EDF Energy, British Gas, npower, EON UK and ScottishPower (those with more than 150,000 electricity customers) to offer a Smart Export Guarantee (SEG). Smaller suppliers can do so on a voluntary basis. Suppliers are already starting to offer SEGs, but all qualifying suppliers will have to offer you terms of payment for your solar power, wind power & other renewable energy exports by January 1st, 2020 at the latest.

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This is good news for solar panel owners, because most likely the scheme will naturally become marketised, rather than subsidised. In the past the Feed in Tariff offered a fixed rate determined by government. Now, instead of a subsidy, the new guarantee will be a minimum rate. Once the new system has kicked in, it seems inevitable that there’ll be competition between energy suppliers to offer better tariffs in order to gain your loyalty.

Consultations for the new scheme began earlier this year with Solar Trade Association members. Tony Sampson, MD at Naked Solar, met with the Department of Business, Energy and Industrial Strategy and confirmed the following two crucial points.

  • To benefit from the new proposed Export Guarantee scheme, you must have an MCS certified installation.
  • Anyone who installed solar panels between the end of the Feed in Tariff and the start of the new scheme will be eligible for the new scheme.

The STA has been arguing for households to be paid at a fair market rate for the power they contribute to our electricity system, as all other generators are. There are two obvious ways to define fair pricing. One is through wholesale prices, which is the price that the market buys power from to sell to you – in 2018 this averaged around 6p/kWh. The other is the ‘System Sell Price’, which the government referenced as a fair price in its SEG consultation. This is the price that larger generators receive for their surplus power when they produce more electricity than they had contractually arranged to produce. The annual average System Sell Price last year was very similar (5.4p/kWh) to the previous FIT export tariff payment of 5.2p/kWh.

This is a very positive development for anyone considering going for solar panels but delaying doing so because of the loss of the Feed in Tariff. Not only have prices come down considerably over the past decade, the new scheme is likely to end up being more generous than the current tariff. With the cost of solar having fallen by 80% since 2008, it was the right time to review the way these payments were made.

The full text of the government announcement earlier this year is below:

“Proposals to protect consumers whilst guaranteeing payments for households with solar by unlocking smarter energy system

More intelligent systems will help power the UK’s transition to a clean and affordable energy system – a key part of our modern Industrial Strategy.

  • New small-scale renewable electricity providers to be guaranteed payment for excess electricity supplied to the grid under government proposals unveiled 8th Jan – protecting consumers from unfair costs associated with current scheme.
  • Plans for Smart Export Guarantee could build a bridge to the smarter energy system of the future, which can help unlock technological innovations like home energy storage and more efficient electric vehicle charging.”

Households and businesses installing new solar panels will be guaranteed payment for power provided back to the grid to unlock the smart energy systems of the future. This can only be an important upgrade to the current Feed-in Tariffs scheme.

The Smart Export Guarantee will see electricity suppliers paying new small-scale energy producers for excess electricity from homes and businesses being put back into the energy grid. The new scheme could create a whole new market, encouraging suppliers to competitively bid for this electricity, giving exporters the best market price while providing the local grid with more clean, green energy, unlocking greater choice and control for solar households over buying and selling their electricity.

The SEG means that households and businesses installing new renewable energy generators will be paid transparently for the energy they produce protecting consumers from cost burdens, by using established smart technology. However the Energy Saving Trust have said that given that it is now widely assumed that the completion of the smart meter roll-out will be delayed beyond the 2020 target date a significant number of non-smart-meter properties will not be able to benefit from the SEG for several years to come. The availability of meters could therefore (a) actually impede householders access to SEG for quite some time, and in addition, (b) delay the ‘smart’ element of this if householders have to be on basic tariffs because they don’t have half hourly data.

Under the old FIT scheme, accredited households and businesses who installed small scale electricity generators are assumed to have exported 50% of the electricity they produced and were paid for it even when the electricity was not needed by the grid or they exported less than 50%.

Earlier on in the year Energy and Clean Growth Minister Claire Perry said:

“This new scheme could help us to build a bridge to the smart energy system of the future, with consumers firmly at its heart – not only buying electricity but being guaranteed payments for excess electricity they can supply to the grid.

It could also reduce strain on energy networks with a more decentralised and smarter local network delivering resilience much more cost effectively, unlocking innovative products for electric vehicles and home energy storage; a win-win for consumers and the environment and a key part of our modern Industrial Strategy.”

At this time the government has only obligated electricity supply companies to buy power at a price above zero. The good news is the electricity sector is changing fast and there are many suppliers who want to embrace smart energy to help deliver a much more efficient, low-carbon power system, and they want customers who want to participate. Companies early to uptake the new system include, Octopus who are offering both flexible and fixed SEGs, Bulb who are offering members who generate their own electricity payment for any electricity they generate and export to the grid (This is for solar-only customers, storage-only or solar and storage co-located), and EON who are paying the first 500 new solar customers 5.24p per every kilowatt-hour (kWh) of energy exported back to the grid on the assumption that 50% of generation is exported.

The more complex new system will take a while to become established but there are still savings to be made which will increase as all the big energy companies come on board and start competing with one another.

Find out more about solar here

How Green is Solar?

solar panel manufacturing

Solar power is labelled as a clean renewable source and this is true as it doesn’t require any fossil fuels or release anything harmful into the atmosphere whilst being used.

The only thing it really requires is some sunlight! There are, however, some beliefs that the manufacturing of solar panels maybe where there is an environmental impact, the main impact being the materials used during the manufacturing process. Most manufacturers, however, recycle these materials to lessen the impact on the environment rather than throwing them away.

Materials such as quartz come from mining and then have to be heated to produce silicon and it is this process where chemicals and energy are involved. After the panels have been made, they usually produce clean energy for 30 years or longer, so that does pose the question of whether the process of making solar panels is outweighed by the positive impacts they have on the environment? – Read more here

Well, the negatives are small compared to the positives and if you compare the process used to make the panels, with that of using fossil fuels such as coal and gas,then there is little negative at all. With solar energy storage gradually becoming more available, the process is even more efficient and greener. 

Solar panels,when being used, do not pollute our atmosphere with any greenhouse gases and do not produce emissions, therefore making them a renewable, clean option. Of course, with every year that passes, new technology is being produced meaning they are becoming much more efficient than ever before and the ability to store the power they produce means their carbon footprint is further reduced. Panel recycling is also becoming more efficient, which is great news for the environment!

Which solar panels are best?

Solar panels have come a long way since they first began, being now much more advanced and making them not only more efficient, but more aesthetically pleasing too. The main types of solar panel available are:

Monocrystalline solar panels: these kinds of solar panels take up less space than the polycrystalline panels but are about the same efficiency. However, these kinds of panels can be more expensive.

Polycrystalline solar panels: the process to make these panels is much simpler which makes them cheaper, however they are slightly less efficient at high temperatures but not enough for residential purposes to worry about. They do, however, require more space as you tend to need more of them.

Thin film solar cells: these work by using substrate and photovoltaic cells and use several layers of the material placed onto a substrate base. There are various materials that can be used, they are simple to produce en mass and can be cheaper – they can also be flexible.

Amorphous silicon solar cell: these usually have several layers which are stacked to increase their efficiency, however compared to other types these are less efficient.

Biohybrid solar cell:  these have been made to utilize a more natural method of photosynthesis by combining organic and non-organic matter which means almost 100% efficiency. They do, however, produce less power overall.

The best solar panel to choose really depends on what you need it for, how much space is available and what your budget is etc. Other things to consider would be battery storage and which way your property faces.