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John Blower, Head of Business Development at Bromsgrove-based Econergy Solutions Limited, discusses the benefits to businesses of roof mounted solar PV systems and solar carports.

The burden of high energy bills has become a reality for many businesses in recent times; and geo-political conflicts, climate related events and the costs of transitioning to net-zero may well cause more upward pressure on bills in coming years.

While the price of power from the grid has climbed ever higher, the costs of solar PV technology have reduced sharply thanks to economies of scale and global competition amongst manufacturers. As a result, roof-mounted solar PV systems can provide zero carbon electricity at a substantially lower cost than mains power, significantly reduce energy bills and make an important contribution to achieving an improved Energy Performance Certificate (EPC) rating.

For many owner-occupied commercial and industrial premises with a roof free from shade, solar PV systems can now provide a payback of less than five years (and sometimes much less!) with a further 20 years plus of solar generated electricity, providing protection from increasing energy prices; solar PV can literally now be one of the best investments a business can make.

And the economics are now so attractive that investment in solar PV can also make strong sense in tenant occupied, landlord-owned buildings. Historically, the situation where a landlord owns a building but doesn’t pay the energy bills, whereas a tenant pays the energy bills but doesn’t own the building has been a barrier to installing solar PV systems. But now the prospect of a landlord improving the energy performance of a building, and so improving its EPC rating and marketability, and the tenant enjoying lower energy bills can make solar PV a beneficial investment for both parties.

There are different legal structures that can be used to deal with investments in solar PV in landlord-tenant situations, including:

• For tenants with sufficiently long leases, tenants can seek permission from the landlord for the tenant to have a solar PV system installed.
• A landlord and tenant can reach an agreement where the landlord invests in a solar PV system and sells the solar generated electricity to the tenant at a price below the prevailing mains power tariff under a ‘Power Purchase Agreement’ (‘PPA’).
• A third-party investor (or a Joint Venture ‘special purpose vehicle’ company) can lease the roof from the landlord, install a PV system and sell the solar generated electricity to the tenant under a PPA.

In each case, an appropriate set of agreements will need to be put in place, dealing with responsibility for, and provision of access for, maintenance, mechanisms for determining the price of the solar electricity within a PPA, insurance arrangements, provisions setting out what will happen at the end of a lease period and so on.

Econergy Solutions is collaborating with mfg Solicitors to help businesses put in place the appropriate agreements.

As the UK continues its drive towards net zero carbon emissions, commercial and industrial solar PV can offer landlords the opportunity to become power generation businesses, creating new income streams; for owners of portfolios of properties these opportunities could be very substantial.

And the opportunity is not just limited to roof-tops. Solar carports can provide an effective solution for using car parking space to generate solar electricity.

A solar carport provides shelter for vehicles, whilst generating solar electricity that can either be used on-site or to charge a fleet of electric vehicles, turning parking spaces into income generating assets.

As a New Year begins, with ever tougher EPC requirements set to be introduced in coming years and the risk of even higher electricity prices a constant reality, 2025 could be an ideal year in which to turn commercial properties into power and revenue generating assets.

For further information please contact Econergy Solutions via their website Econergy Solutions – Solar Panel Specialists

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