PPA, hire purchase or loan: which way to fund solar?

You don't need to find the full cost of a solar system upfront. There are several ways to fund it, and the right one depends on your cash flow, your tax position and whether you want to own the system.

Power Purchase Agreement (PPA)

A funder pays for, installs, owns and maintains the system on your site. You simply buy the electricity it generates, at an agreed rate that's typically lower than grid prices. There's no capital outlay and no maintenance to worry about. Terms are usually long, often 15 to 25 years, and at the end you can usually extend, buy the system or have it removed.

Hire purchase

You spread the cost over fixed monthly payments and own the system once the final payment is made. For tax purposes you're usually treated as the owner from day one, so you may be able to claim capital allowances on the full cost.

Business loan

You borrow the money and own the system outright from the start. You may be able to claim capital allowances, and the interest is usually a deductible business expense.

A quick guide

• Want savings with no upfront cost and no maintenance: a PPA is worth a look
• Want to own it and spread the cost: hire purchase
• Want to own it outright from day one: a business loan

Before you decide

Tax treatment depends on your circumstances, so speak to your accountant. All finance is subject to status and funder approval.

How we help

We'll compare funded and owned options for your site, so you can see the numbers side by side.

Find out more: Finance options