Solar panel loans & finance UK: what are your options?

Solar panels are an excellent way to cut your electricity costs, your reliance on the grid, and your emissions – but the price tag is a barrier for many households.

Solar panel loans make it possible to save money on your energy bills and shrink your carbon footprint without paying a large upfront cost.

In this article, we’ll run through how solar panel loans usually work and how they differ from paying for solar upfront. 

Sunsave Plus, the UK’s first solar subscription, shares some similarities with a loan, but also has some distinct differences. 

If you’re interested in switching to solar at no upfront cost, answer a few quick questions below and sign up for Sunsave Plus - we’ll be in touch.

What is a solar panel loan?

A solar panel loan is a financial agreement that allows you to own solar panels and benefit from them without having to pay the entire cost of the system upfront.

Instead, you’ll pay a monthly amount for a set number of years. This regular payment, the length of the loan, and the interest rate will all vary depending on your chosen provider.

Some companies also ask customers to pay a portion of the sum upfront, before monthly payments begin.

Solar panel loans represent an alternative route to green energy for households that can’t afford to part with thousands of pounds at a time.

Many solar panel loans also include a solar battery, which makes them more attractive, as they can help homes to save even more on their electricity bills.

How much does a solar panel loan cost?

Most solar panel loans come with no upfront cost, though some companies do require households to put down a chunk of the overall amount before they start making monthly payments.

Once this monthly schedule begins, the amount you pay will depend on a few factors, primarily the overall cost of your system, interest rate, and length of your loan.

Short-term loans of one to three years can cost several hundreds of pounds per month, whereas a long-term agreement lasting 10-20 years could set you back less than £100 per month*.

Your payment period will naturally be longer – but depending on your circumstances, that might be a good trade for a lower fee.

Before taking out a loan, you should always check the total amount repayable over the term, which consists of the credit amount plus the cost of any interest and fees. 

When it comes to comparing the cost of different loans, it’s much better to consider the Annual Percentage Rate (APR) as opposed to just the interest rate, as the APR also includes other costs and fees.

* Figure of ‘less than £100 per month’ is based on multiple subscriptions acquired by Sunsave Plus customers in 2024.

How long does a solar panel loan last?

Solar panel loans usually range from two or three years to 10 years.

Some providers give you the option of choosing your own repayment period, usually roughly within this range.

There are also longer loans that last 20 years or more, which can help you reduce your regular payments by spreading out the cost.

Most solar panel loans offer the ability to settle early, but it’s important to check if your provider will charge you a fee for doing this. 

Sunsave Plus, the UK’s first solar subscription, has a 20-year term and allows for full or partial early repayment without charging any fees or penalties. Head further down the page to learn more.

Who is eligible for a solar panel loan?

Every solar panel loan provider will have a set of eligibility criteria, as they need to control their risk and protect the integrity of the financial system.

To qualify for a solar panel loan, you’ll usually have to be a UK resident and own the property that you’re planning to install the system on.

You’ll also have to be in full-time employment to be eligible for some solar panel loans.

Others will accept applicants who are employed, self-employed, retired, in receipt of disability benefits, or a homemaker, as long as they (or sometimes their spouse) earn a gross income of £10,000 per year.

You need to be at least 18 years old to apply for a solar loan, and most providers also set a maximum age limit for the end of the agreement, which is typically 80-85 years old.

Applicants should also ensure they have a bank account in their name, which they’re permitted to use to independently send payments.

You may also need a mobile phone number and email address, as well as at least one official document, such as your passport, driving licence, or a recent electricity bill in your name.

The lender will then check your application, your borrowing history, your credit, and your financial circumstances before deciding whether to give you a loan.

What are the benefits of a solar panel loan?

If you don’t want to pay the full cost of a solar panel system upfront, there are plenty of advantages to getting a loan.

You can start saving money and shrinking your carbon footprint straight away, and pay off the cost in regular, manageable chunks that allow you to plan your budget effectively.

Here are the main benefits:

1. No upfront cost
2. Immediate energy bill savings
3. Export income
4. Reduced carbon footprint

1. No upfront cost

If you don’t have thousands of pounds that you can spend on a big investment without worrying about it, a loan may be the way forward.

Most loan providers won’t charge an upfront fee, which means you can repay the cost of your panels gradually, over a longer period of time. This can range from a year to upwards of 20 years.

Some households find that this is a more affordable way of paying for solar panels.

2. Immediate energy bill savings

You can start using the electricity your solar panels produce as soon as they’re switched on, which allows you to cut your electricity bills straight away.

If you wait to buy solar panels until you can afford to pay the full amount all at once, you may miss out on years of the electricity bill savings.

And considering solar panels can last up to 40 years, it might make sense to start benefiting as soon as possible.

3. Export income

Getting solar panels also allows you to profit from exporting your excess electricity to the grid.

Sometimes your panels will generate more electricity than you need – or if you have a battery, more than you can use and store. Energy suppliers will pay for this excess electricity.

The average household can earn around £350 per year in solar export income.

This figure assumes the home has a 4.4kWp system and 5.2kWh battery, exports 34% of its solar electricity, uses 3,500kWh of electricity per year, and experiences typical UK solar irradiance.

If you would like to see the savings you could get from a solar & battery system, just answer a few quick questions below and we’ll provide an estimate.

4. Reduced carbon footprint

Solar panels will immediately cut your carbon emissions.

A household with a 5.2kWp solar panel system will typically save 1.1 tonnes of CO2 per year, based on a database of 32 solar & battery systems designed by Sunsave, located across England and Wales. Each systems uses 430W solar panels and a 5.8kWh battery.

This would represent a 31% reduction for the average home, which otherwise has an annual carbon footprint of 3.5 tonnes of CO2.

This figure is based on a government report that households account for 26% of the UK’s carbon footprint, the country’s latest emissions total of 384.2 million tonnes, and the fact that there are 28.2 million households across the nation at the last count.

Pitfalls to look out for with solar panel loans

As with any financial agreement, you should only sign a solar panel loan contract if you’re sure it’s the best option for you.

When you’re choosing a solar panel loan, it’s vital that you understand the total cost of borrowing. You need to know how much you’ll be paying overall, including the interest rate and other fees. If the monthly costs turn out to be unaffordable, you will have a very difficult experience and it may have serious repercussions.

Here are the other factors that you should be wary of before committing to a solar panel loan:

• No FCA regulation
• Roof leases
• Inflation-linked fees
• No maintenance support
• Early repayment fees

No FCA regulation

When you’re looking into signing a multi-year solar loan contract with a business, you should ensure the company is fully regulated by the Financial Conduct Authority (FCA).

If the organisation is acting as a broker for a third-party lender, make sure you get their FCA number and check the FCA register, as this will show their permissions. You should then also check that the lender is FCA-regulated. 

Sunsave is fully authorised and regulated by the FCA, and so our Consumer Duty requires us to deliver good outcomes for our customers. 

In practice, what this means is that we sufficiently understand our consumers’ needs, we can demonstrate fair value between the price our consumers pay and the benefits they receive, our content is clear and not misleading, and that our consumers’ needs are fulfilled throughout the lifetime of our product.

Roof leases

Solar panel loans sometimes involve customers leasing their roof (or airspace) to a company, which effectively means giving up control of your roof. These are sometimes known as 'rent-a-roof schemes'.

Some roof leases force you to get permission from the company to make changes to your home – like an extension, loft conversion, or new roof – and to reimburse them for any missed export payments or lost electricity generation that happens because of building work.

It can also affect your chances of selling your home. Some mortgage lenders are wary of roof leases, as it may prevent them from repossessing the property in the event of a mortgage default.  

You may also find some homebuyers avoid properties with roof leases, especially if they’d ideally like to make changes to the home in future.

The company will own your solar installation, which can sometimes mean missing out on hundreds of pounds in export payments every year.

It’s also worth noting that some companies that offer roof leases aren’t regulated by the FCA, which means they don’t have to meet the FCA’s high standards when it comes to treating customers fairly.

For more information, read our guide to why Sunsave Plus does not require a roof lease.

Inflation-linked fees

Some solar panel loans come with a fixed interest rate, which means your monthly payments will be the same for the entirety of your contract.

These can range from 0% to upwards of 14%.

Others, however, include a variable interest rate, which means your monthly fees can increase with inflation.

This makes it harder to plan your budget and can result in you paying considerably more by the end of your loan.

With Sunsave Plus, monthly fees are completely fixed for the full subscription term, which protects you from energy bill inflation.

No maintenance support

Like any household appliance, your solar & battery system may run into issues.

Fortunately, there are loan providers that include maintenance in their contracts, to ensure your system is functioning properly throughout the loan period.

But there are also providers that don’t offer maintenance support – so if anything goes wrong, you’ll have to find a reliable, affordable engineer at precisely the most stressful time to do so.

In contrast, when you have maintenance support, you’ll be able to immediately contact someone who you can trust to get your system back to where it should be.

Every Sunsave Plus system is protected by the Sunsave Guarantee, which you can learn more about further down this page.

Early repayment fees

If you pay off your loan before the end of your contract, some providers may charge you an early repayment fee.

Fortunately, there are companies that’ll allow you to conclude your contract whenever you want, as long as you pay the remainder of the amount you borrowed.

Just make sure to check any provider’s terms and conditions to find out about its early repayment policy.

If you pay up early with Sunsave Plus, you won’t incur any fees, charges, or penalties.

How is Sunsave Plus different to a standard solar panel loan?

Sunsave Plus is not just a solar loan. Though you’ll gradually pay off the cost of the system like a loan, your solar & battery system will also be protected by the Sunsave Guarantee, so you can rest assured your system will keep performing for at least the next 20 years.

The Sunsave Guarantee will provide you with 24/7 monitoring and maintenance, free replacement parts including a battery and inverter, and downtime cover. Your system will also be insured by Aviva, meaning it’ll be fully covered against damage, fire and theft.

We know that uneasiness about maintenance can be a key sticking point for anyone who isn’t sure about solar. A 2021 government study found that 55% of people in the UK who don’t want solar panels attribute their reluctance to maintenance concerns. 

Some technical experts in the industry estimate that a solar & battery system in the UK will need three maintenance call-outs across a 20-year period - one for the panels, one for the battery, and one for the inverter.

This adds not only cost, but also the inconvenience of finding a reliable engineer to help you every time.

Sunsave Plus is also an investment in a cash-generating asset – your solar & battery system will immediately start saving you money on your energy bills, and make you additional income from all the electricity you export to the grid. 

In many cases, your energy bill savings and export income will exceed your fixed monthly payments, meaning the loan actually results in a net saving – an instant, clear return on your investment. To read all about Sunsave Plus customers who are saving money, check out our collection of customer stories.

What’s more, Sunsave Plus is flexible, allowing you to make a full or partial early repayment at any point with no penalties. In the case of a partial early repayment, this will reduce your subscription term and keep your monthly fee the same.

Are solar panel loans worth it?

Solar panel loans have excellent benefits for households that can’t afford the steep upfront cost of a system.

You can instantly start profiting from your panels by cutting your electricity bills, exporting excess electricity to the grid, and reducing your carbon emissions – all for a monthly fee that allows you to spread the cost.

However, it’s important to choose your provider carefully, to ensure you don’t end up with a fee that’s too high – either from the start or because it’s linked to inflation – or a company that’s not fully FCA-regulated.

Sunsave Plus will provide you with the best-in-class kit, 24/7 monitoring and maintenance, and free replacement parts, all in one easy solar & battery package that comes with a 20-year Sunsave Guarantee and no upfront cost.

Your installation will be tailored to your home, work seamlessly, look excellent, and save you money from day one.

Solar panel loans: FAQs