Executive Summary
Solar panels and home battery systems are excellent technologies that should play a significant role in the UK’s transition to clean electricity. However, they are not a realistic or affordable solution for every household.
Many families simply cannot afford the upfront investment, while the financial return can take many years to recover. In winter, when electricity demand is highest, solar generation is at its lowest, limiting the benefit.
This policy therefore focuses first on making electricity affordable for everyone through a national tariff. Solar and batteries remain encouraged, particularly for households with very high electricity consumption, but they should not become a requirement for people simply to achieve affordable energy bills.
The Problem
Much of the current debate assumes that households should solve high electricity prices by installing rooftop solar panels and batteries.
This overlooks several important realities:
- Millions of households do not own their homes.
- Many roofs are unsuitable because of shading, orientation or structural limitations.
- Low-income households cannot afford the upfront investment.
- Older households may never recover the cost during their time in the property.
- Flats and apartments often have no practical option to install rooftop solar.
Affordable electricity should not depend on whether someone owns a suitable roof or has thousands of pounds available to invest.
The Cost Barrier
Although prices have fallen significantly, solar and battery systems still represent a substantial investment.
Even newer plug-in balcony solar systems and plug-in battery products typically cost hundreds or thousands of pounds.
For many households facing rising mortgage costs, rent, food bills and other essentials, this money simply is not available.
Those who would benefit most from lower electricity bills are often the least able to make the investment.
Long Payback Periods
For the average household, the financial return from solar and batteries can take many years.
While some installations can achieve quicker returns under favourable conditions, many households are looking at around ten years or more before recovering their investment.
This creates two problems:
- the savings are spread over a very long period;
- major components such as battery inverters often begin approaching the end of their expected service life around the same time.
Although solar panels themselves can last 25–30 years or more, electronics such as inverters usually require replacement sooner, adding additional costs before the original investment has been fully recovered.
Winter Is When Electricity Matters Most
Solar performs exceptionally well during long summer days.
Unfortunately, the UK’s greatest electricity demand occurs during winter, when:
- daylight hours are short;
- cloud cover is more frequent;
- heating demand increases significantly.
At exactly the time households need the most electricity, solar generation is producing the least.
This means solar alone cannot solve the challenge of affordable winter electricity.
Home Batteries Are Less Attractive with Affordable Electricity
Home batteries can reduce bills by charging overnight and supplying electricity during the day.
Under this policy:
- Off-peak electricity costs 7.5p/kWh.
- Standard peak electricity costs 15p/kWh.
This means each unit shifted from night to day saves only 7.5p.
While that represents a 50% saving, the actual amount saved per unit is relatively small.
For most households, it would take many years—potentially decades—for battery savings alone to recover the purchase price.
This is a positive outcome because it means electricity itself has become affordable without requiring every household to purchase expensive technology.
Where Solar and Batteries Make Sense
The proposed tariff deliberately creates stronger incentives for households with exceptionally high electricity demand.
Once a household exceeds its monthly peak allowance, electricity becomes more expensive:
- 30p/kWh for the first excess tier.
- 60p/kWh for the highest tier.
At these prices, the economics of:
- rooftop solar,
- home batteries,
- smart energy management,
- and shifting electricity demand
become much more attractive.
Rather than forcing every household to invest, the policy encourages those placing the greatest demand on the grid to reduce that demand through local generation and storage.
Commercial Buildings Should Lead
The greatest missed opportunity is not domestic housing—it is commercial and industrial buildings.
Every year the UK constructs:
- warehouses,
- supermarkets,
- distribution centres,
- factories,
- offices,
- and retail parks
with enormous roof areas that often remain completely unused.
These buildings typically:
- have large uninterrupted roofs;
- consume electricity during daylight hours;
- require little additional infrastructure to support solar generation.
Installing solar as standard on suitable new commercial buildings would deliver significantly greater national generation capacity than relying solely on domestic rooftops.
Commercial premises should therefore become the priority for expanding solar generation across the UK.
Benefits
- Keeps affordable electricity available to everyone, not only homeowners.
- Protects low-income households from being left behind.
- Avoids making expensive technology a requirement for lower bills.
- Maintains strong incentives for high-demand households to invest in local generation.
- Focuses national solar deployment where it delivers the greatest return.
- Improves energy resilience without increasing inequality.
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Frequently Asked Questions
Are you against solar power?
No. Solar is an important part of the UK’s future energy mix. The policy supports wider deployment where it is economically sensible.
Why not subsidise batteries for everyone?
Public money should first ensure everyone has access to affordable electricity. Subsidies should focus on areas where they deliver the greatest benefit to the electricity system.
Won’t cheaper electricity discourage green investment?
Not for high-consumption households. The tiered tariff creates strong financial incentives for larger users to install solar, batteries and smart energy management while ensuring ordinary households continue to benefit from affordable electricity.
Should new commercial buildings have solar panels?
Where practical, yes. Large commercial roofs represent one of the biggest untapped opportunities for increasing renewable generation with minimal impact on land use.