What Asset Finance Actually Is
In plain terms: you borrow the money to buy the system, and pay it off monthly.
The lender settles the invoice with the installer. Your business becomes the legal owner of the panels, inverters and monitoring kit on day one. From that point on, every unit of electricity the system produces is yours to use for free — and every unit you don't use can be exported to the grid for a payment.
You'll typically choose between two structures:
Hire Purchase
You own the system outright at the end of the term, once all payments have been made. This is the most common choice.
Finance Lease
The lender owns the equipment, you use it and pay for it. Slightly different tax treatment. Your accountant will have a view on which suits you.
Terms usually run 5–10 years. Payments are fixed, so you know exactly what the system costs each month for its whole finance life.
Why Businesses Choose This Over A PPA
Under a PPA, the funder owns the system for 15 years, and you pay them a fixed rate for the electricity it makes. Under asset finance, you own the system from day one — and you get the full return.
That means you keep:
- ✓100% of the electricity generated, not a discounted rate
- ✓The carbon credits the system produces (typically £50/tonne, more for community-benefit sites)
- ✓Any export income from selling surplus back to the grid
- ✓The full 25-year life of the panels, not just the 15-year PPA term
The trade-off is that you carry the debt on your books, and you're responsible for maintenance once warranties expire. Some businesses want that; others don't.
Tax Position (Ask Your Accountant, But Worth Knowing)
Solar equipment typically qualifies for Full Expensing — the current UK regime lets qualifying businesses write down 100% of the cost of new plant and machinery against profits in the year of purchase.
On a £250,000 system, that can mean a Corporation Tax reduction of £62,500 in year one at the 25% rate.
There are conditions and pool categories that affect exactly how it applies to solar. Your accountant will be able to confirm the position for your business. But it's often the single biggest reason a cash-generative business opts for asset finance over a PPA.
Rough Shape Of The Numbers
Every quote is site-specific, but as a worked example:
A £250,000 commercial rooftop system financed over 7 years at typical current rates would sit around £3,500–£4,000 per month.
If the same system saves you around £4,500 per month on your electricity bill from day one, you're cash-flow positive from the first month.
You own a debt-free system generating free electricity for 18+ years after the loan clears. That's the case for asset finance in a sentence: monthly payment lower than monthly saving, and you own the asset at the end.
*Actual repayments depend on the lender, your credit profile, term length and market rates at the point of drawdown. Savings depend on your usage pattern and grid electricity price.
When Asset Finance Suits, And When A PPA Suits
Both routes deliver clean, cheaper electricity. Which one delivers more to your business depends on how you'd rather structure it.
Asset finance tends to make sense when:
- You want the full return, not a shared one
- You can put the capital allowances to work against your tax bill
- You're the long-term owner of the building
- You're comfortable taking on maintenance after warranty expiry
- Debt on the balance sheet isn't an issue for you
A PPA tends to make sense when:
- You want zero upfront and zero ongoing risk
- You want maintenance and monitoring handled for the whole term
- You want the arrangement off the balance sheet
- You'd rather not add a 5-year loan to your next bank review
- You want simplicity — one fixed low rate, one invoice a month
What Sunbase Does
We're an introducer, which means we're not tied to one lender or one installer. When you come to us:
Our partner assesses your site and designs the right system.
We put the finance package in front of you, alongside a PPA quote.
Our partner builds it.
You own it and start saving.
Typical time from initial conversation to the system being live: 30–60 days, depending on site survey and DNO approval.
Common Questions
How does asset finance compare in monthly cost to a PPA?
On most sites, the numbers are surprisingly close. A PPA gives you a lower monthly outlay because the funder is amortising the system over a longer period and taking the returns. Asset finance costs a bit more per month over 7 years, but you own the asset at the end and get 18+ years of near-free electricity after that.
Do I need to put anything down?
Some lenders will finance 100%; some prefer a 10–20% deposit for the best rates. We'll talk you through the options once we know your business profile.
What credit checks are involved?
Standard business credit check. Lenders usually want to see two years of accounts. If your business is newer or has anything unusual in the numbers, we've got lenders who'll still look at it. With all the right paperwork in place, asset finance decisions can be made within 24 hours.
Can I finance batteries and EV chargers too?
Yes. Batteries and EV chargers typically qualify on the same finance arrangement as the panels.
What if the system underperforms?
The monthly finance payment is fixed regardless. That's why the site survey stage matters — we design conservatively, so the numbers still work if generation comes in a bit below projection.
Can I switch from a PPA to asset finance later?
Not easily — the funder owns the system under a PPA. It's a decision worth thinking through at the outset. Happy to model both for you side by side.
Which Route Suits You?
Book a free site assessment. Our partner will design the system, and we'll price a PPA and an asset finance package alongside each other, letting you choose the one that fits your business.