Government Grants for Solar Panels: Are You Eligible as a UK Business?

Are you considering solar panels for your business but worried about the cost? With rising energy prices and increasing pressure to adopt sustainable solutions, many UK businesses are looking for ways to make solar energy more affordable. Government grants for solar panels can help reduce the financial burden and make renewable energy a viable option for your company.

But what grants are available? Who qualifies? And how can your business apply?

In this guide, we’ll break down the key government grants for solar panels, explain eligibility criteria, and walk you through the application process. Whether you’re a small business or a large corporation, this article will help you understand how to take advantage of financial incentives and reduce energy costs.

Why the UK Government Supports Solar Energy for Businesses?

The UK government has set ambitious targets for reducing carbon emissions, aiming to reach net-zero by 2050. The government encourages businesses to adopt renewable energy sources like solar power to achieve this. By offering grants and financial incentives, the government aims to:

• Reduce reliance on fossil fuels.
• Lower energy costs for businesses.
• Support businesses in meeting sustainability goals.
• Enhance national energy security.

Investing in solar energy helps businesses cut costs and improves brand reputation and demonstrates a commitment to sustainability—something increasingly valued by customers and stakeholders.

This data is sourced from the UK government’s Department for Energy Security and Net Zero, which provides monthly updates on solar PV deployment. The figures represent the cumulative installed capacity at the end of each year, reflecting the growth in solar adoption across the UK.

It’s important to note that while this data encompasses both residential and commercial installations, a significant portion of the recent growth is attributed to increased adoption by businesses. For instance, in 2024, there was a notable rise in commercial solar installations, contributing to the overall increase in capacity.

This trend highlights the growing commitment of UK businesses to sustainable energy practices and the significant role of solar power in the nation’s energy landscape.

Government Grants & Incentives for Solar Panels in the UK

Several financial incentives are available to help businesses install solar panels. Here’s a breakdown of the most relevant schemes:

1. Smart Export Guarantee (SEG)

The Smart Export Guarantee (SEG), introduced in January 2020, mandates that licensed electricity suppliers with over 150,000 customers compensate small-scale renewable energy generators for surplus electricity exported back to the grid. This scheme replaced the previous Feed-in Tariff (FiT) program.

2. Annual Investment Allowance (AIA) & 50% First-Year Allowance

The Annual Investment Allowance (AIA) allows businesses to deduct the full value of qualifying capital assets, including solar panels, from their profits before tax, up to a specific limit. The 50% First-Year Allowance also enables businesses to claim 50% of the cost of qualifying assets in the first year.

3. Green Business Finance Schemes

Various government-backed loans and financing options are available to support businesses in implementing green projects, including solar panel installations. These schemes aim to make renewable energy investments more accessible by offering favorable financing.

4. Regional & Local Authority Grants

Various regional and local authorities offer grants to businesses investing in renewable energy projects. These grants aim to promote local sustainability initiatives and reduce carbon emissions.

Comparison Table of UK Solar Panel Incentives for Businesses

By leveraging these incentives, UK businesses can significantly reduce the financial barriers associated with installing solar panels, leading to long-term cost savings and contributing to environmental sustainability.

Are You Eligible for a Solar Panel Grant?

Not all businesses qualify for government grants for solar panels, as different schemes have specific requirements. Before applying, companies should assess their eligibility based on the following factors:

Key Eligibility Factors

Business Type

• Some grants are exclusively for small and medium enterprises (SMEs), while others cater to larger corporations.
• Local authority grants may prioritise certain business types, such as manufacturing, retail, or hospitality.
• Public sector organisations like schools and hospitals may have separate funding opportunities.

Energy Consumption & Usage Profile

• Businesses with high electricity usage benefit more from incentives like the Smart Export Guarantee (SEG), which allows them to sell surplus energy.
• Companies that operate 24/7 facilities, such as data centers and warehouses, may qualify for additional financial support.

Location-Specific Availability

• Regional and local council grants vary based on the area’s sustainability goals and funding availability.
• Businesses in urban areas may have access to incentives promoting rooftop solar, while rural businesses may find agriculture-related solar grants.
• Some funding is linked to decarbonisation zones or low-carbon investment areas.

Type of Solar Installation

• Roof-mounted solar panels are often prioritised for funding due to space efficiency.
• Ground-mounted solar installations may be eligible for agricultural or large-scale industrial grants.
• Grants may require businesses to use approved solar panel technologies and Microgeneration Certification Scheme (MCS)-certified installers.

How to Check Your Business’s Eligibility?

Review Official Government Resources

• Check gov.uk and local council websites for updated grant lists.
• Look at past recipients to understand typical qualification criteria.

Assess Your Energy Profile

• Calculate current energy usage and costs to determine the financial benefit of solar panels.
• Identify potential savings from incentives such as SEG payments or tax relief schemes.

Consult with a Renewable Energy Expert

• EvoEnergy can assess your eligibility and recommend the best financial support options.
• Get guidance on grant applications and compliance requirements.

Prepare Necessary Documentation

• Gather business registration details, energy bills, and any relevant sustainability goals.
• For tax relief grants, ensure you have accurate financial statements.

Step-by-Step Guide to Applying for Government Solar Grants

Applying for government grants for solar panels requires a structured approach. Each grant has specific eligibility criteria, required documentation, and processing times. Below is a detailed guide to help businesses through the process efficiently.

Step 1: Research Available Grants

• Identify the most relevant grant schemes based on your business type, location, and energy consumption.
• Check the official UK government website, local councils, and energy regulatory authorities for up-to-date information.
• Consider consulting solar energy specialists like EvoEnergy to find the best financial incentives for your project.

Step 2: Check Eligibility Requirements

• Review the grant-specific criteria to ensure your business qualifies.
• Some grants prioritize SMEs, while others support large-scale industrial or public sector projects.
• Determine if your business operates in a region with additional local funding for solar installations.
• Confirm whether your planned installation meets the technical requirements, such as using MCS-certified solar panels and installers.

Step 3: Prepare Documentation

Having the necessary paperwork ready will speed up the application process. Commonly required documents include:

• Business Registration Details – Proof of company incorporation or VAT registration.
• Energy Usage Reports – Recent utility bills or energy audits.
• Solar Installation Plans – Technical specifications and supplier agreements.
• Financial Statements – If required for grant approval, tax returns or balance sheets.
• Sustainability Commitment – Some grants require businesses to outline their carbon reduction goals or energy efficiency plans.

Step 4: Submit the Application

• Most grants require online submission through government portals, local authority websites, or relevant energy agencies.
• Ensure that all sections are completed accurately, as errors may delay approval.
• If applying for multiple grants, check if they can be combined or require separate applications.

Step 5: Wait for Approval

• Processing times vary, depending on the grant and application volume. Some grants have rolling applications, while others operate on fixed deadlines.
• Businesses may be contacted during this phase for additional information or site assessments.
• Check the grant provider’s website or contact their support teams.

Step 6: Install Solar Panels

• Once the grant is approved, businesses can proceed with installation.
• Use approved suppliers to ensure compliance with grant conditions.
• If required, provide proof of installation to claim the grant funds or tax incentives.

Step 7: Claim Incentives

• Businesses eligible for Smart Export Guarantee (SEG) payments should register with an approved energy supplier.
• For tax relief grants, such as the Annual Investment Allowance (AIA), businesses must include the investment in their tax filings.
• Some grants require periodic reporting on energy savings or environmental impact to maintain compliance.

Estimated Application Timeline for Different Grant Schemes

Below is an estimated timeline for applying for various government grants for solar panels. Processing times vary based on demand, location, and grant-specific requirements.

These timelines serve as a general guide. Some grants may experience delays due to high demand or regulatory checks. Businesses should apply well in advance of their intended installation date.

The Financial Benefits of Solar Panels for Your Business

Investing in solar energy is not just a commitment to sustainability but a financially strategic decision that can deliver significant long-term savings and revenue opportunities for businesses. Here’s how:

Lower Energy Bills

One of the most immediate benefits of installing solar panels is reducing electricity costs. By generating power on-site, businesses can significantly cut down their reliance on energy supplied by the grid. Solar power provides financial stability with volatile energy prices by allowing firms to produce electricity rather than depending on market rates.

For businesses with high energy demands, such as manufacturing facilities, warehouses, or large office buildings, these savings can translate into substantial cost reductions over the system’s lifespan, typically 25 years or more.

Return on Investment (ROI)

Although the initial installation cost of solar panels can be high, government incentives such as grants, tax relief, and the Smart Export Guarantee (SEG) can help offset this cost. Businesses that take advantage of these financial support mechanisms often see a return on investment within five to ten years, depending on location, energy consumption, and available subsidies.

Additionally, given the long lifespan of solar panels, businesses can continue benefiting from free electricity generation for decades after their initial investment has been recouped.

Selling Excess Energy

Under the Smart Export Guarantee (SEG), businesses can earn money by selling any surplus electricity generated by their solar panels back to the national grid. This creates an additional revenue stream, making solar panels more financially attractive.

The amount businesses can earn depends on their solar generation capacity, self-consumption rates, and energy tariffs offered by licensed electricity suppliers. Businesses that operate mainly during daylight hours may benefit the most, as they can maximise the use of the energy they produce.

Increased Property Value

Installing solar panels can enhance the value of commercial properties. Buildings with renewable energy systems are considered more attractive to potential buyers and tenants, particularly those with sustainability commitments or corporate social responsibility (CSR) policies.

Solar-powered properties often benefit from the following:

• Reduced operational costs, making them more appealing to long-term tenants.
• Higher resale values due to their energy-efficient infrastructure.
• Compliance with future energy efficiency regulations, avoiding potential costs of retrofitting later.

How Can EvoEnergy Help Your Business Secure Solar Grants?

Navigating government grants for solar panels can be a complex process, requiring businesses to understand eligibility criteria, gather documentation, and meet compliance requirements. EvoEnergy provides a comprehensive approach to help companies access financial support for solar energy projects.

Expert Consultancy on Solar Incentives

With extensive experience in renewable energy solutions, EvoEnergy assists businesses in identifying the most suitable government grants and incentives. We analyse your business’s energy needs, location, and industry sector to determine which funding opportunities align with your goals.

By staying current with government policies, tax relief schemes, and local authority grants, our team ensures that your business maximises available financial support for solar installation.

Custom-Designed Solar Solutions

Every business has unique energy demands, and a one-size-fits-all approach does not work for solar panel installations. EvoEnergy designs tailored solar solutions that align with your energy usage, available space, and financial objectives.

• Roof-mounted solar panels for businesses with large flat or pitched roofs.
• Ground-mounted solar solutions for companies with open land suitable for installation.
• Battery storage systems to enhance self-consumption and optimise cost savings.

Our team evaluates solar generation potential, system size, and return on investment to develop an optimal plan for your business.

Ongoing Monitoring and Maintenance

Once your solar panel system is installed, ongoing maintenance is essential to ensure peak performance and long-term savings. EvoEnergy offers:

• Real-time monitoring systems to track solar output and detect any performance issues.
• Scheduled maintenance and servicing to maximise system efficiency.
• Support with regulatory compliance to ensure continued eligibility for government incentives such as the Smart Export Guarantee (SEG).

By providing end-to-end support, EvoEnergy helps businesses achieve a smooth transition to solar energy, while taking full advantage of government funding opportunities.

Calculate Your Potential Savings

EvoEnergy’s Solar Panel Calculator allows businesses to estimate how much they could save by switching to solar energy. You can get insights into potential cost savings, return on investment, and CO₂ reduction by entering details about your energy consumption and available roof space.

Get Expert Advice Today

Transitioning to solar power is a major financial and environmental decision. With government grants available, businesses have never had a better time to invest in renewable energy. EvoEnergy is here to guide you through the process, from grant applications to installation and long-term support.

Contact EvoEnergy today for a free consultation and take the next step towards reducing energy costs while contributing to a greener future.

Frequently Asked Questions

1. What government incentives can UK businesses tap into for solar panels?

Businesses can benefit from:

• The Smart Export Guarantee (SEG) – earning money for surplus energy exported to the grid.
• Annual Investment Allowance (AIA) and 50% First-Year Allowance, offering tax relief on solar equipment costs.
• Green Business Finance Schemes – low-interest or government-backed loans.
  Regional or local authority grants – varies by location and council.

2. How do I know if my business qualifies for solar panel grants or incentives?

Qualification depends on:

• Your business type (SME, corporate, public sector)
  
• Your energy usage, SEG favors businesses with daytime export potential
  
• Your location, local grants may be region-specific
  
• Technical requirements, installations typically must be MCS-certified using appropriate technologies.

3. What does the application process look like for these grants or incentives?

1. Identify suitable schemes via gov.uk and local council sites
2. Check eligibility criteria
3. Gather documentation (business registration, energy bills, financials)
4. Submit application through government or council portals
5. If approved, proceed with compliant installation
6. Claim incentives through SEG registration or tax filings.

4. How long does it take to receive approval or benefits?

• SEG: Rolling application, takes 4–6 weeks to apply; approval in 1–2 months; payments start after that.
• AIA: Claimed via annual tax return, no separate approval needed.
• Green finance: Typically 6–12 weeks for approval.
• Local grants: Varies by council; usually 6–16 weeks, and installations often must begin within 6 months of approval.
  

5. As a business, what financial advantages do solar panels offer?

• Lower electricity costs by generating your own power.
• Income from exporting surplus energy via SEG.
• Tax savings through allowances.
• Potential ROI within 5–10 years, depending on incentives and usage.
• Enhanced property value and attractiveness to sustainable-focused partners or tenants.