The Case for Commercial Solar in 2026
Strip out the sales noise and four hard factors decide the timing question for London businesses: power prices, tax treatment, the EPC trajectory, and the compounding cost of every year not generating.
The four numbers behind the timing argument
1. Power prices have reset, not retreated
The 2022 spike passed; the old prices never came back. London businesses signing 2025–26 supply contracts are typically paying 24–30p/kWh once non-commodity costs are counted — roughly double pre-2021 norms — and the structural components of the bill (network charges, policy levies) only move one way. Against that, a rooftop kWh costs roughly 5–8p over the system's life on a London install. The spread between those two numbers is the business case, and 2026's spread is historically wide.
2. The tax treatment is as good as it has been
The Annual Investment Allowance covers qualifying plant up to £1 million with a 100% first-year deduction — the entire cost of nearly any London rooftop system, deducted from taxable profits in the year of purchase. At 25% corporation tax, that is an effective 25% discount for profitable companies. Larger investors past the AIA cap still claim the 50% first-year allowance on solar as special-rate plant. Tax regimes change; this one is in place now, and projects commissioned in 2026 bank it.
3. The EPC clock is running, especially in London
Commercial lettings below EPC E are already restricted. The proposed MEES trajectory — C by 2027, B by 2030 — remains to be enacted, but the capital's institutional landlords are not waiting: EPC trajectory now features in lease events, valuations and refinancing conversations across the London market. Rooftop PV is one of the most cost-effective single measures for improving an office or industrial EPC, and unlike most fabric measures it produces revenue while doing it. For buildings near a threshold, fitting solar in 2026 is cheaper than explaining its absence in 2027 — the sector pages for offices and industrial property cover the detail.
4. Waiting has a price tag, and it compounds
A 100kW London array generates roughly £20,000 of annual value at current rates. Defer a year and that £20,000 is simply gone — it does not accrue, it is not recovered by marginally cheaper panels later, and meanwhile your energy contract renews at whatever the market says. Over a five-year delay the forgone value approaches the entire capital cost of the system that was not built. The GLA's 2030 net zero target and the London Plan's Policy SI 2 expectations are pushing the capital's building stock in one direction; the only open question for most viable roofs is which budget year carries the project.
What 2026 action actually looks like
Not a signature — a feasibility. Half-hourly data and roof drawings produce a desk model inside a week: system size, yield, London-priced costs, funding comparison, planning screen and UKPN read. If the numbers clear your hurdle rate, the project proceeds on evidence; if they don't, you have a written answer and lost nothing. Either outcome beats another year of paying full price for every kilowatt-hour under a roof that could be generating.
The questions boards ask about timing
Shouldn't we wait for panel prices to fall further?
Hardware is now roughly a third of a London project; the rest is labour, access, compliance and grid work, none of which is getting cheaper. A further 10% panel price fall saves perhaps 3% of project cost — while a year of waiting costs a typical 100kW London system around £20,000 in unrealised savings. The arithmetic of waiting stopped working several years ago.
Are the MEES EPC C 2027 and B 2030 dates law?
They remain government proposals rather than enacted regulation, and dates have moved before. What is already law: commercial property in England and Wales generally cannot be let below EPC E. What is already fact: institutional landlords and lenders are pricing the proposed trajectory into valuations and refinancing now. Solar improves the rating either way — the proposals only sharpen the timing.
Could grid electricity prices fall enough to undermine the case?
The payback maths holds even under price falls that no serious forecast projects. A 100kW London system at 27p/kWh paybacks in under 4 years; at a 20p/kWh world it still paybacks inside 5.5. Meanwhile non-commodity costs — network charges, levies — that make up a large share of commercial bills continue rising. Solar is a hedge that pays you while you hold it.
Is there any UK-wide grant for commercial solar in 2026?
No general grant — and be wary of anyone implying otherwise. The support is structural: 100% year-one tax deduction via the Annual Investment Allowance (or the 50% first-year allowance for special-rate assets), export income under the Smart Export Guarantee framework, and 0% VAT on the domestic side only. Sector-specific public funding exists (public sector decarbonisation rounds, for instance) but mainstream commercial projects stand on their own economics — which is precisely why they keep getting built.