Solar panel lease agreements

The sun shines on the righteous - or perhaps that should read 'on the well advised'!

Many clients are seeking our advice on 'standard' leases from companies interested in placing solar panels on the roof of their house. The offer is attractive; the house owner gets free electricity and can export surplus power to their electricity provider, resulting in lower bills and a potential increase in property value. The installer provides the equipment at his expense and, in return, keeps the income from the Government Feed-in-Tariffs (FiT) and retains ownership of the equipment.

There are good and bad operators in this arena and some very one-sided leases circulating. Because the equipment is going on your roof, a lease is needed to rent the space to the solar panel company and to regulate the ongoing relationship between you and it. The company will want the arrangements to stay in place for 25 years to ensure maximum pay-back on their installation costs and to ensure it can claim the full amount of FiT income. That is fine, but the lease needs to cover such important aspects as maintenance and repair of the roof, repair of the equipment, perhaps upgrading the equipment, damage, insurance, not allowing trees to block sunlight to the panels and rights of access.

A properly negotiated lease will cover all these issues - and many others - fairly, but householders should be wary when presented with what are described as 'non-negotiable standard documents'.

As we have said, there are some excellent solar panel companies offering a very good service to consumers - be they residential home owners or businesses with large roof spaces that could take solar panel installations; indeed, we act for some of them. However, there are others who are less scrupulous and who seem to be approaching the elderly, in particular, with their offers. Being able to distinguish between them is essential, as is ending up with a lease that is fair to both parties, as the relationship will continue for many years. Obtaining proper and timely advice is vital.

David Rayner
david.rayner@birkettlong.co.uk