What is the ROI on solar panels and a battery for your business?

Calculate solar returns from electricity you actually use, export receipts and running costs. Then assess the battery's extra value against its extra capital, including losses and foregone export income. Ofgem's SEG guidance covers eligible solar installations up to 5 MW [S1]; it does not set a universal export price. Compare fully funded, part funded and self funded proposals. Checked October 2026.

Last checked 16 October 2026

How do you calculate solar ROI?

Start with electricity bills and interval consumption, then request a roof-specific generation model. Photovoltaic (PV) panels generate electricity. kW means kilowatts of power; kWp means kilowatts peak, the panel rating under test conditions. kWh means kilowatt-hours of energy. Keep rated power and annual generation in separate columns.

Yearly net value = electricity used on site × avoided purchase rate + electricity exported × export rate − running costs. This combines a bill reduction and cash receipts; it is not all cash income. Simple return on investment (ROI) = net value ÷ invested capital × 100. Payback = invested capital ÷ yearly net value.

The Smart Export Guarantee (SEG) can pay eligible generators for exported energy. Ofgem states that suppliers set the payment and contract terms; the tariff must remain above zero [S1]. Obtain your own export offer. Do not substitute a household tariff or count every generated unit at your import price.

What is the commercial solar payback period?

The following is an illustration, not a quote. All cost, output, tariff and operating inputs are assumptions, not surveyed estimates or market averages. Low, mid and high mean increasing direct use of generation at your site.

At low use: 27,000 × £0.25 + 63,000 × £0.05 − £1,000 = £8,900 yearly net value. Repeat with 45,000 and 63,000 kWh used directly for the other cases.

Ranges use the capital endpoints. They exclude VAT, tax, grants, financing, roof work, rates, insurance and major replacement. Output and prices are held constant. Ask your accountant to review a cash-flow model including those costs and degradation before treating this as an investment decision.

Is battery storage worth it?

Test the battery separately. Assume an additional £30,000–£40,000 capital cost for a 50 kWh usable battery, with 25 kW discharge power. Assume it takes 10,000 kWh of otherwise exported solar each year and returns 90% to loads that would otherwise buy electricity. Assume £500 annual extra service and monitoring costs.

Extra net value = 9,000 × £0.25 − 10,000 × £0.05 − £500 = £1,250/year. Incremental ROI = £1,250 ÷ £30,000–£40,000 = 3.1–4.2%; payback is 24–32 years. This arithmetic does not establish that the battery will last that long. Request a replacement scenario and compare it with the supplier’s terms.

At mid use, solar plus battery gives £12,500 + £1,250 = £13,750 yearly net value. Total capital is £100,000–£130,000, so combined ROI is 10.6–13.8% and payback 7.3–9.5 years. The combined result can conceal a weak incremental battery case. Do not buy the battery merely because solar performs well.

Before accepting the assumed throughput, require an interval simulation showing surplus energy, charge limits, losses and later demand. Do not add tariff trading or flexibility receipts without a separate evidenced model.

How does solar only compare with solar plus battery under different funding?

For a common solar-plus-battery design, assume the fully funded provider pays all equipment and running costs and pays you fixed roof rent of £1,000–£1,500/year. Electricity purchase terms remain a separate negotiation. This is a hypothetical rent assumption, not an observed offer.

For part funded, assume you contribute £50,000–£65,000 and retain 60% of the combined net value. The provider bears the remaining capital and costs already deducted above. Such a benefit-sharing arrangement needs explicit metering and settlement terms; it is not an automatic right associated with part funding.

Part funded value = self funded value × 60%. Apply the ROI and payback formulas above to your contribution. Fully funded has no host capital payback here. Compare the actual electricity contract, roof commitment, repair access, exit costs and reinstatement with your solicitor; rent alone cannot settle the decision.

How would EV charging change the calculation?

Keep a charging model beside the roof model. The following optional charging assumptions are separate from every solar result above; they are not additional forecast income.

At an assumed 365 operating days, charging net = sessions × 365 × 20 × (£0.50 − £0.25) − £600. These assumptions include losses within the energy rate and payment costs within the annual allowance. Use the part funded worked example for the contribution and payback comparison. If solar supplies the charger, remove those units from export or other site-use totals before combining models.

What does your site need before you order?

Ask for roof condition, structural capacity, planning, fire-safety, battery siting and insurance reviews. Your distribution network operator (DNO) is the local network company. UK Power Networks describes the solar and storage connection process [S2] and the G99 application route for larger projects [S3]. G99 is the engineering recommendation for connecting generation equipment. Ask your designer which route and export limit apply to your combined system.

Next step

Bring bills, interval data and roof details to get matched with an installer that covers your area. Also compare charger payback and funding choices. Piggy Pineapple Ltd operates this referral service. We refer enquiries to installer partners and may be paid a fee. Our owner holds shares in at least one partner. Before passing on your details, we name the proposed partner and disclose whether our owner holds shares in it. See how we work.