Guide
Funding solar PV and battery storage as one project
Solar and storage are two assets with one operating case. Funding them under a single facility is usually simpler, cheaper to administer and easier for a funder to read than two separate applications.
The short version
- One facility means one credit decision, one set of documents and one payment date.
- Storage raises self consumption, which is what makes the generation asset earn at import rates rather than export rates.
- Terms are usually set to the shorter lived asset unless the facility is split internally.
- Phased installs can still be funded together using a staged drawdown.
Why one facility usually beats two
Two applications means two credit decisions, two sets of documents, two payment dates and two chances for something to slip. It also splits the story: each funder sees half a project and neither sees the operating case that justifies both halves.
Presented as one project, the proposal explains what the site consumes, what the array will generate, what the battery will retain and what the combined saving looks like. That is a stronger case, and it is normally reflected in the terms.
How the structure normally works
Hire purchase over five to seven years is the most common shape for a combined project, because both assets have long working lives and most businesses want to own them at the end. A finance lease is used where the initial outlay needs to be lighter.
- Deposit: VAT only on well supported cases, moving to ten to twenty percent where the covenant is weaker.
- Term: typically set to the shorter lived component, which is usually the battery or the inverters.
- Drawdown: staged against installation milestones where the array and the storage are commissioned separately.
- Scope: mounting systems, inverters, switchgear, protection, cabling, scaffolding and commissioning all normally sit inside the facility.
Sizing the two together
Sizing solar to the roof and the battery to a brochure is how projects end up under used. The array should be sized to the load profile and the roof, and the battery sized to the surplus that would otherwise export plus the peaks worth shaving.
That sequencing matters for funding as well as engineering. A funder reading a proposal where the battery capacity is justified by measured export volume and demand peaks is being shown an operating case. A funder reading round numbers is being shown a shopping list.
If the battery comes later
Plenty of sites install solar first and add storage once the export data is in. That is a reasonable engineering decision and it does not have to mean two unrelated finance agreements.
Where the phasing is known upfront, the intention can be set out at the start so the second stage is a shorter conversation with a funder that already knows the site. Where the solar is already installed and paid for, refinancing the array alongside a new battery is often possible and can fund the storage without new cash.
Where this applies
FAQs
Common questions
The questions that come up most often on this subject.
Can solar panels and battery storage be financed on one agreement?
Yes, and it is usually the cleaner route. Both assets are funded under a single facility with one credit decision and one repayment, and the funder assesses the combined operating case rather than two separate purchases.
What term is used when solar and battery are funded together?
Five to seven years is typical. The term is normally set against the shorter lived component, which is usually the battery or the inverters, unless the facility is split internally to reflect the different asset lives.
Can I add battery storage to solar I have already financed?
Usually yes. The existing agreement can often run alongside a new facility for the storage, or the array can be refinanced so the two sit together. Which is better depends on how far into the existing agreement you are.
Does adding storage improve the funding case for solar?
Frequently, because storage lifts self consumption. Generation used on site is worth the import price you avoid, which is normally well above the export rate, so the saving the funder is reading gets larger and more predictable.