Free solar panels offers, what the catch?

Question: I am considering an offer of free solar panels on my house. The offer seems very generous. There is no charge, a 25-year guarantee and all work involved is done by accredited installers. Is there any drawback to this type of solar panel offers?

Answer: Yes, there are several drawbacks.

Solar panel installation

Solar panel installation

The feed-in tariff (Fit scheme), where home owners generating their own electricity are paid by energy companies for every unit of power they feed into the national grid.

It is the Fit scheme that makes photovoltaic, solar panels worthwhile as an investment, because it might earn the average solar owners around £900 a year from a £12,000 to £15,000 (around 7% return as opposed to 3% by leaving it in a bank account).

The promotional literature from these types of solar companies suggests that the average home owner signing up for this type of rent-your-roof scheme will reduce their electricity bills by around £150 per year.

The biggest problem with these types of schemes are people who are out at work during the day time, for example, won’t see much benefit from the free power being generated, but if you own the panels yourself, then you will benefit by being paid for the energy your panels produce, whether you use the power during the day or not.

In contrast, by installing its PV solar panels on your roof, this free solar panels companies will be claiming all your feed-in tariffs (Fits) for themselves.

You will have to sign a contract leasing your roof and the air space above it to the company for 20 years, for no additional payment. The lease will be registered by the Land Registry, and, therefore, legally binding.

More pitfalls for free solar panels?

You won’t be able to change your mind or remove the panels during this 25 year period and should you want to sell your house, the new owners will also be bound by the terms of that lease, thus vastly reducing your ability to sell your property. I personally wouldn’t buy a house once I found that I wouldn’t even benefit financially from the surplus electricity they produced.

Stuart Lovatt from Heat my Home adds “My grandparents taught me that something that is too good to be true. The question you have to ask is how is the free solar company benefiting from your home. Simply, by earning lots of money from it, so this begs the question, why would you not want to earn that money for yourself?”

Heat my Home does not offer free solar panels, but we help people who want to benefit from the government feed-in tariff scheme themselves.

  • Jane

    What I want to know is what happens after 25 years, are the panels yours or do the company come and remove them, or worse, expect you to do so. Who pays if any maintenance or repair is required? What happens if the tariffs the company receive are reduced (as appears to be happening) and they go bankrupt. I am looking to buy a property, and thought I had found the perfect one, but have just read it is subject to a 25 year solar panel lease. All the potential hassle for the sake of 3 or 4 hundred a year and peace of mind. Now the words “….barge pole” come to mind.

  • mark Robins

    I’ve just been to see my bank about a mortgage on a home which has “free” solar panels fitted ie roof leased for 25 years.
    Niether Natwest, Nationwide or Yorkshire bank would offer a mortgage on a property with A leased roof system as in they would be unable to repossess the property.

    So be warned!!

  • Shaz

    Hi,
    I can clearly see that the writer of above data have used a complete negative approach whereas there are lot of benefits installing free panels under rent a roof scheme like the main purpose of panels is to generate electricity which the home owner will benefit for the rest of the life of panels by spending £0 in total, although ppl are working during the day time but most of the houses with children consume most of electricity during day which can be used by panels, secondly i believe its a myth that free solar panels put the buyers off buying your property… Why some one do not want to buy a house which creates its own electricity? A survey done by a company based in yorkshire results that houses sells 30% more faster than normal houses.
    They look after the panels for 20-25 years. They make sure they are up and runing because if the panels are not working they will not get paid. And free solar panels are the best quality you can get for panels as they will be the main source for incomeAtlast i would like to say that not many ppl want to invest £1000’s on PV

  • http://www.heatmyhome.co.uk Stuart Lovatt

    Hi worried wind

    Solar panels have been tested and tested with approval from BRE institute (building regs) and these types of systems are installed most in Yorkshire and Scotland since the 1960’s, so wind has never been an issue in the UK or else were in the world.

  • WorriedWind

    What worries me is sticking £10k on the roof. It’s very windy sometimes I’ve seen fence panels lifted up and tossed around and they weigh much more than these solar panels. Who takes the risk of wind damage?

  • James

    Hi

    I am currently working with a company offering the free solar panel option, I believe they are offering the best deal for both free and bought panels, with 1-12 panels at only £6500 each, they also offer the package of having the panels free (maintenance and installation included) but after having the panels for 1 year you can buy them for only £4700. Which the company don’t want you to really do, but they have to offer a buy back plan, also they are doing a loan scheme soon in which you buy the panels back via the F.I.T tariff (estimated buy back time is only 11 years) which then gives you another 14 years of free electric/money.

  • KfromDerby

    I have been offered 16 panels by Isis due to the size of my property – 3.8/3.9 kw system which I have been told is the one highest available on the market. I am no expert in this area and would appreciate your views before I sign on the dotted line. Initially this seemed like a no brainer as I was getting a free system with savings of 40% on my bills.

    Uponreviewing the Isis Solar’s Lease Agreement, and found this to be very oneroous which offers very little flexibility to the customer, where as ISIS have the option to cancel the agreement if the system is “uneconomically viable”. Termination costs are also extortionate. I am very keen to have to Solar Panels mainly for the costs benefits but there are no details of how much saving I am likely to make. Can anyone who has the free system installed share their experience!

    I agree that buying such system yourself is likely to be the more sensible option however I dont have £10k and unable to take out a loan at present. Look forward to your views

  • Nick Noyce

    most people dont work 7 days a week and during the summer surely get home in time to benefit from a few hours sun at least?

    who cares if the airspace on the roof is leased? It might interfere with the helipad i was planning to have built up there but doubt i would get planning permission to do that anyway.

    I recently been told I can pay myself to have them done for £7000 and make about £2000 a year off the electric company so would pay for itself in 4 years and continue to pay for another 21 years. some of that power trickling into your daily (daytime) used energy also thus redusing the electricity bill.

    Obviously if you have a spare wad of cash then its a good investment, otherwise various companies will invest in your airspace and benefit from the 25 years of payment… still unsure why 25 is the magic number?

  • https://www.heatmyhome.co.uk Stuart Lovatt

    The viewing conversation will go:

    “Oh great, it’s got solar panels”

    “Well the solar panels are not ours, we leased our roof out to a solar company”

    “oh dear!”

    “But if you stay at home all day, you can use the power they generate”

    “We go to work in the day because we have a mortgage to pay for”

    “You probably won’t benefit from them then”

    “That’s a shame, I don’t think this house is for us then”

  • Richard Hitchcox

    The only issue if you call it an issue is the leasing of the roof.If you are selling a house that will consume significantly less energy than other house in your street the house will sell believe me.

  • https://www.heatmyhome.co.uk Stuart Lovatt

    Hi Mr Woods

    Each of these ‘free solar panels’ companies work in differing ways. I’m afraid its look at the terms and conditions with a fine tooth comb. Many issues I hear about, come about from commission driven sales people who do what sales people do.

    The reason the feed in tariffs have recently been reduced recently, is to prevent such companies from operating and draining the funding pot which was intended only for home owners, not investment companies, so ‘free solar panels’ will soon be a thing of the past.

  • RON WOODS

    is it true that some companys offering free pannels, take any money you get from the grid ,this is to pay for pannels .BUT if you do not get a sertain amount of money from the grid they come to you to pay the shortfull to the company, we have had a salesman call today singing my nabours up and when i ask this question he could not give me a replay
    answer please

  • Ian

    I had an offer from EON to install for £99. I filled in questionnaire online an used Google map to identify the bungalow and it was approved online. I was told a survey would be booked within 14 days.

    7 days later we had a phone call frrom EON saying we were not eligible as we were 9 degrees off course.

    Having had 3 companies to survey already who stated we were ideally situated, and had solar panels for water heating already which gives us plenty of hot water we need from April to October I find this hard to accept. I have asked them for a more detailed explanation but they have not replied.

    I thought the PV solar panels ran on daylight and not necessarily direct sunlight, and we get as much daylight as anyone else in the South East. So perhaps ‘free solar panels’ offers are not free unless they suit the installer.

    Regards Ian.

  • Darren

    Hi to all,

    Some companies offer free solar panels (contract 25 years), but every year will offer you to purchase the pv panels . The offer price will decrease every year as the pv panels get older. I think this is the way to go if you dont have £12,000 spare.

  • https://www.heatmyhome.co.uk Solar Stu

    Hi Mark

    The point of this is to get people to read between the lines. People get excited because they think they are getting thousands of pounds worth of solar panel equipment for nothing and think their energy bills will evaporate, were in most cases they will not.

    Like everything in life, if something is too good to be true, it probably is.

    This article is pointing out the negative sides of such an arrangement, so people can make an informed choice, rather than a one sided view point from companies who’s interests are only to make money from your roof space.

    I appreciate not everyone can afford this type of technology, but those who can will receive more benefits doing it themselves.

  • Mark Lewis

    This is an extremely biased one sided view. Yes it is true that paying for the install would be better in order to gain the FITs but if you don’t have the capital then at least you can still benefit from free electricity and help the environment. Personally I would buy any house with solar panels over one without.

  • Knut kase

    Adrian,

    You are right about the need to have a spare

  • adrian

    above comments are fine if you have a spare 12,000 pound. for people who do not then it is an option to save some money. all you have to due is ajust your life and make sure you use the majority of your electricity during sunny periods. eg washing clothes etc.