The roof of your property is worth a lot of money, whether you own or rent it. With rising energy bills and a growing demand for greener living, landlords and tenants alike are starting to see the value of solar energy.
When it comes to a rented property, things get a little bit more complicated, but nothing that SolarTherm UK can’t break down for you in this article. From permissions to finance, here’s everything tenants and landlords need to know about a solar panel installation on a rented property.
Who finances a solar panel installation?
Landlord funded installations
In most cases, it would be the landlord who would need to fund the installation of your solar PV system. The panels become a fixed part of the property and contribute to its long-term value. The landlord also benefits from a higher EPC (Energy Performance Certificate) rating which is important when letting the property and can give the potential for higher rent for energy efficient properties.
Are Solar Panels Worth It for Landlords?
Installing solar panels can be a worthwhile long-term investment for landlords, particularly where the property has a suitable roof, consistent electricity demand and tenants who can use a good proportion of the electricity generated.
The financial benefits depend on how the property is let and who pays for its electricity.
- Where tenants pay their own electricity bills: Solar panels can make the property more attractive to prospective tenants by offering the opportunity to reduce electricity costs. The landlord’s return is more likely to come from the property’s overall appeal and any export income they are eligible to receive.
- Where the landlord pays the electricity bills: The landlord may benefit directly from using solar-generated electricity instead of purchasing all the property’s electricity from the grid.
- Where a property has multiple occupants or shared facilities: The electrical arrangement needs to be assessed carefully to establish how the generated electricity can be used and who benefits from the savings.
Before investing, landlords should compare the installation cost with realistic estimates of solar generation, electricity consumption, self-consumption, export income and ongoing maintenance.
The expected length of ownership also matters. Solar panels can provide benefits over many years, but the financial return will depend on the actual system performance and the property’s circumstances.
At SolarTherm UK, we can assess a rental property’s suitability for solar PV and battery storage, helping landlords understand the likely costs, potential savings and practical considerations before making a decision.
Tenant funded installations
When tenants have a long-term let agreement, it can sometimes be agreed that the tenant funds or co-funds a solar installation, especially if they are going to be the main beneficiary of the savings. The tenant benefits from lower electricity bills, more energy independence and the opportunity live a more sustainable lifestyle. However, it is challenging to decide who pays for the system if they move before the system has paid for itself and that would need to be agreed and decided before installation takes place
Who benefits from solar energy in a rental property?
This will all depend on how the system is used and the agreement that is in place. The tenant will benefit from reduced electricity bills, especially if they are using most of their electricity in day-light hours or have smart tech such as timers installed to run their appliances. If the landlord receives the SEG (Smart Export Guarantee) payments for exported electricity, they may recoup some of the investment and some landlords choose to adjust the rent slightly to reflect the property’s improved energy efficiency.
Do Tenants Benefit from Solar Panels?
Yes. Tenants can benefit from solar panels installed on a rented property, even when they do not own the system. The main benefit is the opportunity to use electricity generated by the panels rather than buying all their electricity from an energy supplier.
The amount a tenant saves depends on how the solar system is configured, how much electricity the household uses during daylight hours and the terms agreed with the landlord.
For example, running appliances such as washing machines and dishwashers when solar panels are generating electricity can help tenants make better use of the energy available. A compatible battery can store surplus solar electricity for use later in the day, including during the evening.
However, the electricity bill savings and any payments for exporting surplus electricity are two different things. The tenant may benefit from using the generated electricity while the landlord, as system owner or eligible generator under the relevant arrangements, may receive Smart Export Guarantee (SEG) payments.
Before installing a system, landlords and tenants should agree how the system will operate, who will receive any export payments and whether the arrangement affects the rent or other tenancy terms.
The key point: tenants do not necessarily need to own solar panels to benefit from them. What matters is how the electricity is used and how the arrangement is structured.
What permissions and legal requirements are there?
Landlords must ensure all planning, DNO (Distribution Network Operator) approval and building regulations are met. They will also need to inform tenants of planned work and make them aware of any expected disruption before installation. Tenants who are financing the solar PV system will require written permission from their landlord before installing anything.
An EPC rating of band C or above will be a legal requirement for all rental properties from 2030 – solar panels can boost your EPC rating.
At SolarTherm UK, to protect the property and longevity of your solar PV system, we recommend working with an MCS-certified installer, and choosing am EPVS-accredited installer for transparency around performance and savings.
Can a Tenant Install Solar Panels Without the Landlord’s Permission?
Tenants should obtain written permission from their landlord before arranging a solar panel installation on a rented property. Roof-mounted panels involve alterations to the building, electrical connections and potentially changes to the roof structure, so they should not be treated as an ordinary tenant improvement.
The landlord should establish whether any additional consent is required, including permission from a freeholder, mortgage lender or property management company where applicable. Planning requirements and building regulations must also be considered, and the installation must meet the relevant electricity network connection requirements.
If the tenant is contributing towards the installation, both parties should agree in writing:
- Who will pay for the equipment and installation.
- Who owns the solar panels and battery.
- Who is responsible for maintenance, repairs and insurance.
- Who receives any eligible export payments.
- What happens to the system and any outstanding financial commitments when the tenancy ends.
These details should be agreed before work begins to avoid disputes later.
For landlords, using a qualified, appropriately certified installer can help ensure that the proposed system is assessed, installed and commissioned correctly. SolarTherm UK can advise on the installation requirements and the suitability of a property before proceeding.
How SolarTherm UK can help
We’ve helped landlords across the South East turn rental properties into energy-efficient homes for over 15 years. We are MCS-certified, are Gold Members of EPVS accreditation scheme and are an Octopus Energy Trusted Partner.
We can help you discover the potential of your roof and advise on finance options and any grants you or your tenant may qualify for. We can also offer annual maintenance checks and advice over the phone for any questions you or your tenant may have.
So whether you’re a landlord looking to increase property value, or a tenant hoping to cut your energy bills, our expert team will work with both parties to find a win-win solution to your solar power needs.
Solar for rented properties is not only possible, it’s becoming increasingly popular. With the right agreement in place, both the landlord and tenant can benefit from a cleaner, sustainable future.
Ready to explore your options?
Contact SolarTherm UK today for a free bespoke design package, tailored to your property and future energy goals. No hard sell, just honest, expert advice.
Your home. Your energy. Your future.
Frequently Asked Questions
Yes, tenants can benefit from solar panels installed on a rented property. They can use the electricity generated during daylight hours, potentially reducing the amount they need to buy from their energy supplier. Savings depend on when electricity is used, the system’s output and whether a battery is installed. Any payments for exporting surplus electricity are separate and depend on the applicable export arrangements.
If you rent your home, you can ask your landlord to consider installing solar panels. You should not arrange roof-mounted panels yourself without obtaining the necessary permissions. The landlord will need to consider the property’s suitability, installation costs, ownership of the equipment and how the system will benefit both parties.
Solar panels can be a worthwhile long-term investment for landlords, depending on the property’s electricity consumption, installation cost and how the system will be used. Landlords who pay the electricity bills may benefit directly from reduced energy purchases. Where tenants pay their own bills, the benefits may include a more attractive property and potential export income for the eligible system owner or generator. A financial assessment is recommended before investing.
The landlord usually pays when they choose to install solar panels as a property improvement. However, other arrangements may be possible if the parties agree to them in advance. Any contribution from a tenant should be documented in writing, including ownership of the equipment, maintenance responsibilities and what happens when the tenancy ends.
Smart Export Guarantee (SEG) payments go to the eligible generator under the relevant agreement with an energy supplier. This may be the landlord or another eligible system owner, depending on the ownership and contractual arrangements. Tenants should not assume they will receive export payments simply because they use the electricity generated by the panels.
A landlord arranging improvements to their property should consider the tenancy agreement, the tenant’s rights and any access or works requirements. Installing panels may involve scaffolding, contractors and temporary disruption. Landlords should communicate with tenants in advance and follow the applicable legal requirements and tenancy terms before work begins.
Solar panels may make a property more appealing to some buyers or tenants because of the potential for lower electricity bills. However, an increase in property value or rental income is not guaranteed. The impact depends on factors such as the installation’s condition, ownership, remaining lifespan, energy performance and local property market.
Installing solar panels on a rented flat can be more complicated than installing them on a detached house. The roof may be controlled by a freeholder or management company, and the building may have shared electrical infrastructure. The landlord and any other relevant parties must establish whether the installation is permitted and technically feasible before proceeding.
Solar panels may be suitable for Airbnb and holiday-let properties, particularly where there is regular electricity consumption from heating, appliances, lighting and laundry. However, returns depend on occupancy patterns, daytime electricity use, installation costs and whether the property has a battery. Landlords should assess expected energy demand throughout the year before deciding on system size.
Solar panels can contribute to a property’s energy performance assessment, but they do not guarantee a particular Energy Performance Certificate (EPC) rating. The final rating depends on the property’s wider characteristics and the applicable assessment methodology. Landlords should obtain appropriate advice if they are installing solar panels as part of a wider energy-efficiency improvement plan.
Yes, a compatible battery may be added to an existing solar PV system, subject to a technical assessment. A battery stores surplus electricity for use when the panels are generating less power, such as in the evening. For landlords, the potential benefit depends on the system configuration, installation cost and who uses the stored electricity. Compatibility, electrical requirements and any necessary permissions should be checked before installation.
Landlords can contact a qualified solar installer to assess the roof, electricity consumption, available installation options and likely financial returns. SolarTherm UK provides solar PV and battery storage solutions for suitable properties, helping landlords understand the practical requirements and potential benefits before committing to an installation.
