Free PV schemes can be attractive if you do not have sufficient savings, or access to credit, to fund the installation of a solar energy system….
Free PV works by:
- The company installs the solar panels on south, south-west or south-east facing roofs
- The company pays for the installation, connection charges and the maintenance of the panels
- The home owner benefits from free electricity from the panels (could be a saving worth £100 or 20% of annual usage, depending on how much of the solar energy is used on site)
- Any electricity that is not used is exported into the local electricity network. Any income associated with this is likely to go to the installation company
- As the owner of the solar panels, the company receives the full FIT income
Who’s eligible for Free PV?
We do not currently offer “free pv ” schemes to individual home owners. We can “Rent your roof space” for the following:
- Housing Associations
- Local Authorities
- Commercial property owners
The Energy Saving Trust (EST) have compiled the following useful guide on what to ask if offered free solar PV
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 EST have 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.
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:
- Maximise savings by using appliances such as washing machines and dishwashers during the day when the power provided by the solar PV is highest
- Avoid wasting energy by putting some cost effective energy efficiency measures in place, such as; using low energy lightbulbs, avoid leaving appliances on standby, turn down room thermostats, etc