With the introduction of Feed-in-Tariffs (FIT) there are a number of organisations offering customers free solar PV panels.
Typically, the company installing the solar PV panels will receive the income from the generation and export tariffs for the site, while the customer will benefit from reduced energy bills through the electricity generated on the site.
It should be noted that some companies may not offer the generated electricity for free, but instead offer it at a discounted price.
If you are considering a free solar PV offer, you should calculate what the annual benefit to you will be. If the electricity is to be free then it may have a cash-equivalent value of £100, depending on the size of the system. If the electricity is to be supplied at a discounted price, then this figure will be even less and you should consider whether it’s worth going ahead.
The Energy Saving Trust supports the uptake of microgeneration so long as the technologies:
*this is based on a 2kWp system which is expected to be fairly typical in size for most homes.
These free solar PV offers are also referred to as "rent my roof space" schemes with the solar panel owner simply 'renting' the roof space from the customer.
Here is a list of key questions to ask if you are approached by a company offering free solar PV. Also included are some guidance notes we’ve drafted on the sort of responses you may get or what a good response might be.
Q. Who’s paying for the equipment? Is that in full? Who owns the equipment? (and is that all of the equipment – i.e. meter, wires inside building etc – or just equipment on the roof/in the back yard?)
We would expect anyone offering this scheme to pay for the equipment in full. This includes the solar panels, the inverter, metering and wiring of system. All equipment is likely to be owned by the company with many handing over ownership after 25 years.
Q. Who gets (a) the generation tariff, (b) the export tariff, (c) the ‘free’ electricity?
We expect the company providing the free technology to receive the full generation tariff and the export tariff (around £25 per year for a 2kWp system), and for you to benefit from the free electricity. If the company isn’t offering all the electricity for free then you should carefully consider whether it’s worth going ahead as benefits may be minimal.
We estimate the amount of ‘free’ electricity to be around £50 per installed kW. This is based on 50% of the electricity being used onsite and 50% exported. For example, we estimate that a 3kWp system would provide a cash-equivalent electricity saving of £150. You can estimate this yourself using our Cashback Calculator.
Q. Is the electricity used onsite and/or exported going to be metered, or will it be assumed that 50% (the deeming assumption in FIT) will be used?
It’s highly likely this amount will be deemed at 50%, as this is the standard unless an export meter is fitted. It is also likely that this amount will change in the near future when Smart meters are introduced.
Q. Who pays for maintenance and repairs (e.g. if the DC/AC inverter fails after 8 years)?
All maintenance and repairs should be paid for by the company installing the equipment, as they are likely to be the owner of the technology. You should check for this in any agreements.
Q. Who will insure the equipment? Against what?
It’s likely that you won’t own the equipment so you should not have to insure it. It is therefore up to the company to insure their equipment against fire, theft, wind damage etc.
Q. Who will be liable if the equipment causes damage to my family or my neighbours? Or if it causes damage to mine or my neighbours’ building or electrics?
This may be difficult to answer as you would have to prove that the damage was negligence on the part of the company installing the equipment e.g. faulty wiring. Any faulty work should be reported to the company immediately for them to rectify.
It is also crucial that the company checks that the roof is strong enough so a structural assessment should be carried out.
Q. Are you in effect lending me money to do this, either as a loan or a hire purchase deal? In which case: How long for? What is the annual equivalent interest rate (AER) on the money? Where is your consumer credit license? and; Can I have 7 or 14 days cooling off please (depending on whether the deal was done in person)?
For most free solar PV offers there will be no loan agreement as the equipment will be owned by the company. However, if you are being offered the system as a purchase in its own right (equipment and installation) then you should consider very carefully any loans being offered, and should seek independent financial advise before going ahead.
Q. What happens if I decide I want to pay off the remaining costs early? Can I have the FIT re-assigned to me?
This will depend on the contract drawn up between you and the company.
Q. What happens if I move house and the new owners don’t want to ‘inherit’ the deal?
It’s highly unlikely the company offering the panels will want to sell them back or allow you to sell along with house. Therefore the agreement will stick with the property and you will have to consider this when selling the property. This is one of the key questions you should ask anyone offering such scheme.
Q. Are you giving any performance guarantees for the equipment? (and what happens if it stops working and generating FITs for you? Is that your risk?)
This is the company’s risk as it relates to performance of the system and quality of products used. However most PV cells have manufacturer performance guarantees ranging from 20-25 years so this shouldn’t be a problem.
Q. Do I need to let my mortgage company and/or buildings insurer know that this installation has taken place? Will I need their permission?
We recommend telling your mortgage provider about this before going ahead.
Q. Who is responsible for addressing any planning issues or electricity distribution company notification requirements? Who pays any associated costs?
We expect the company providing the offer to be responsible for all of this. However, we recommend you inform your local planning office prior to going ahead. Solar PV is permitted development, read further information on Getting planning permission.
Q. What happens if the company which owns the equipment ceases to exist or goes into liquidation?
This will vary for each situation. However, because the system generates an income then the liquidators may decide to keep it running in order to pay off creditors.
If you do decide to go ahead with a free solar PV offer, if is also worth considering the following:
Read our comprehensive guide to the Feed-in-Tariff Scheme.
Use our Home Energy Generation Selector tool to help identify the technologies that might be suitable to generate heat or electricity for your home.
It's packed with:
