Side-by-side comparison
Worked example: 320 kWp on a multi-let London office. £288,000 total capex. 294 MWh/year generation. 78% self-consumption. 28p/kWh grid rate.
| Factor | Cash purchase | Asset finance (7-yr, 7.5% APR) | Operating lease | PPA (20-year, 12p/kWh) |
|---|---|---|---|---|
| Upfront capex | £288,000 | £0 | £0 | £0 |
| Year-one tax saving (AIA) | £72,000 | £72,000 | Lease payments deductible | n/a |
| Net effective year-one cost | £216,000 | Cash-flow positive | Cash-flow positive | Cash-flow positive |
| Annual benefit (years 2-25) | £96,000 | £42,400 (7yr) then £96k (18yr) | £64,000 | £55,000 |
| 25-year cumulative benefit | £2,160,000 | £2,000,000 | £1,720,000 | £1,400,000 |
| Simple payback | 4.5 years | Cash-flow + month 1 | Cash-flow + month 1 | n/a (no capex) |
| IRR | 15.8% | 13.2% (effective) | n/a | n/a |
| On balance sheet? | Yes (asset) | Yes (asset + loan) | Yes (IFRS 16) | Off-balance-sheet |
| Asset ownership at end | You | You (after 7 yr) | Lessor (or buy-out) | PPA provider |
| Exit on building sale | Captured in sale price | Refinance / settle | Novate / settle | Novate or buy-out |
| Performance risk | You | You | You | PPA provider |
The decision
Pick on the basis of your specific situation:
Cash purchase
Best for: Owner-occupied office, capex-comfortable balance sheet, organisation prioritising 25-year value over cash position. AIA-eligible.
Asset finance (7-yr, 7.5% APR)
Best for: Strong covenant, capex-constrained, 10+ year remaining lease. Cash-flow positive month one.
Operating lease
Best for: Off-balance-sheet preference, shorter remaining lease, simpler accounting preference.
PPA (20-year, 12p/kWh)
Best for: Zero capex appetite, multi-let landlord, performance risk transfer preference, complex tenant mix.
How we model it for you
For every office solar proposal, we model the relevant comparison options side-by-side. Send us your half-hourly meter data and roof plan via the quote form, and we'll return a fixed-price proposal within 7 working days with all relevant routes compared in your specific situation.