First Choice Utilities
- Feb 8, 2023
- 3 min read

Fully Funded Solar (PPA) – How does it work?

***VOLTAGE OPTIMISATION NOW AVAILABLE AS PART OF SOLAR PPA***

(Read below to find out more, or contact your First Choice Account Manager for more information)

Below we give you an insight into fully funded solar (PPA) and how it works, followed by some real savings examples and FAQ’s, as well as an introduction into the inclusion of Voltage Optimisation as part of the agreement.

We design and install fully funded solar PV systems which save your business money and cut carbon emissions.

You effectively “lease out” your roof space to the system funder in exchange for energy provided to your premises at a much-discounted rate, versus energy provided via your traditional energy supplier.

Energy is provided to the business via the system, bypassing your meter, and is charged at an agreed rate.

In the event that you are consuming energy outside of the systems capabilities, then energy will be drawn from the system primarily, with support energy being drawn via your meter secondarily.

Example

Business is consuming 1,000,000 kWh of electricity per annum.

System is capable of covering 40% of overall energy usage.

PPA rate is agreed at 9p/kWh

Energy cost is 35p/kWh.

Under traditional energy supplier (via grid / meter)

Business pays 1,000,000 x 35p/kWh = annual cost £350,000

Under the PPA agreement

400,000kWh are charged at 9p, (via funder), saving 26p/kWh, = total £36,000 (saving

£104,000)

600,000kWh are charged at 35p, (via supplier / meter), = £210,000
Total annual cost = £246,000
Annual savings = £104,000

Where available, and when circumstances permit, we can also include a Voltage Optimisation unit as part of the agreement, helping to protect your electrical equipment, reducing maintenance costs, energy waste, and energy spends through harmonisation.

FAQ’s

Do I pay for servicing, maintenance, or call outs?

No, the system is fully funded, installed and insured for the lifespan of the agreement, without any capital costs to your business. You only pay for the energy you consume, which is generated by the panels.

Do I pay for design or site survey?

No, these costs are not incurred by you.

What happens when the system doesn’t cover my entire usage?

You will then revert to drawing energy from the grid via your meter and be billed by your supplier for the energy you consume as per your energy contract.

What happens to the additional energy I don’t consume?

The system is designed around your energy requirements, and only has a very small amount of export due to times your energy usage differs / lowers, and panels which are included to provide energy during peak usage times are unused.

What do the savings look like?

This will be dependent entirely on your energy tariff, and the size of the system feasible, based on energy usages and behaviours, and your available roof space, which is how it is important we collect as much accurate information as possible.

How long is the PPA agreement?

This can differ dependent on your preferences, with terms available as low as 5 years and as long as 25 years. The shorter the term, the higher the PPA rate is likely to be, whereas a longer term provides lower PPA rates.

What happens at the end of the agreement?

The ownership of the system transfers entirely to you without additional costs so that you can enjoy free, self-generated green energy. Typically, modern day panels have a lifespan of 35-40 years before there should be consideration to replace, although with rapid advancements in technology, this is often improving.

What is Voltage Optimisation?

Voltage optimisation is an energy saving measure which regulates incoming power, reducing the voltage delivered to electrical equipment.

It works effectively as a control valve to reduce energy consumption to within European Harmonised voltage limits, improving the lifespan of machinery, reducing maintenance costs by avoiding energy surges and overvoltage and protecting key components, saving money on energy costs and energy waste, without affecting levels of production.

Savings Examples (Solar PPA)