What is a solar PPA for a farm or agricultural business?
A solar Power Purchase Agreement (PPA) for farms is the zero-capital route into agricultural solar. Instead of buying the PV system yourself, a third-party developer funds, owns, installs, and operates it on your farm buildings or land. You sign a long-term agreement to buy the electricity it generates at a fixed, discounted unit rate — and you pay nothing upfront. It is the same mechanism large commercial and industrial sites have used for years, now widely available to UK agricultural businesses in 2026.
There are two main structures. An on-site PPA puts the panels on your roofs or land and you consume the power directly behind the meter — the most common farm arrangement. A sleeved or private-wire PPA routes power from a nearby installation to your site via the grid or a private cable, used where your own roof or land is unsuitable. For most farms, on-site rooftop PPA on dairy parlours, poultry sheds, grain stores, or livestock buildings is the right model.
How a farm PPA works — five steps
- Feasibility from your meter data. We pull 12 months of half-hourly electricity data and building dimensions, and model system size, generation, and self-consumption — free of charge.
- The developer funds the capital. Once the numbers work, the funding partner commits the full capital cost of modules, inverters, racking, and connection — you commit nothing.
- DNO G99 connection. The developer submits and manages the G99 grid-connection application with your Distribution Network Operator, carrying the connection-timeline risk.
- MCS-accredited installation. The system is installed to MCS commercial standards, including any combined re-roof under CAR 2012 where asbestos cement cladding must be removed first.
- You buy discounted electricity; the developer runs the system. You pay the agreed unit rate for what you use; the developer owns and maintains the system for the full term with 25-year O&M.
PPA vs buying outright with 100% AIA vs asset finance
A PPA is not automatically the best route — it is the best route when you lack capital or want zero risk. Here is the trade-off in brief:
| Route | Upfront cost | Who owns it | Keeps SEG export? | Best for |
|---|---|---|---|---|
| PPA | £0 | Developer (transfers at term end) | No (developer retains) | No capital / zero risk / 250 kW+ |
| Buy outright + 100% AIA | Full capex | You | Yes | Profitable incorporated farms — best lifetime returns |
| Asset finance | Deposit + 5–10yr repayment | You (after term) | Yes | Want ownership but spread the cost |
For the full decision framework with worked economics, see our PPA vs asset finance vs capital comparison and the cost of farm solar in 2026.
Is your farm suitable for a PPA?
PPAs work best where four things line up:
- Scale — most developers want ~250 kW or above. Smaller systems usually favour purchase or asset finance.
- Strong day-time baseload — dairy parlours (24/7 cooling, robotic milking), poultry and pig units (continuous ventilation), grain stores (harvest drying), cold stores. The more electricity you use while the sun shines, the more discounted PPA units you buy instead of full-price grid imports.
- Sound or re-roofable buildings — modern steel-portal roofs are ideal; pre-2000 asbestos cement roofs need a combined re-roof first (see below).
- Available roof or land — south or east-west facing rooftops, or unused paddock for ground-mount.
PPA on an asbestos-cement roof
Many pre-2000 farm buildings carry asbestos cement roof cladding, which cannot be retrofitted with PV under the Control of Asbestos Regulations 2012. A PPA can still work — the developer funds a combined re-roof and solar install: HSE-licensed asbestos removal, profiled steel re-cladding, then PV on the new roof. This turns a deferred maintenance liability into a funded, income-generating asset with no capital outlay.
What happens to export income under a PPA?
Under most farm PPAs the developer retains the Smart Export Guarantee (SEG) income from surplus generation, because they own the system. You benefit from the discounted unit rate on what you consume on-site. If keeping the SEG export income matters to you — for example on a grain store that exports heavily outside harvest — buying the system (with 100% AIA) keeps both the savings and the export revenue. We model both scenarios so the trade-off is explicit.
PPA contract terms to check before you sign
- Term length — 15–25 years is standard; some developers push 30. Longer locks you in but lowers the unit rate.
- Price escalator / indexation — how the unit rate rises each year (RPI, CPI, or fixed). Model this over the full term.
- End-of-term ownership transfer — residual value, extension, or removal. Get this in writing.
- Break clauses — what happens if you sell the farm or want to exit early.
- Performance guarantee — minimum generation commitment and what happens if the system underperforms.
- Tenant/landlord consent — required on let holdings; we manage the tripartite agreement. See tenant-farmer solar.
Get a free farm PPA suitability assessment
Send us your half-hourly meter data, building dimensions, and a brief on your farm operation. Within 7 working days we tell you whether a PPA is viable for your site, what discount rate is realistic, and how it compares to buying outright with 100% AIA or asset finance. We work with MCS-accredited developers and have delivered 180+ farm installs across England, Scotland, and Wales. If a PPA is not right for your farm, we will tell you and recommend the route that is.
PPA for farms — common questions
What is a solar PPA for a farm?
A solar Power Purchase Agreement (PPA) is a contract where a third-party developer funds, owns, installs, and operates a solar PV system on your farm — on rooftops or ground-mount — at no capital cost to you. You simply buy the electricity it generates at a fixed, discounted unit rate (typically 14–18p/kWh in 2026 versus ~25–28p/kWh grid retail), over a 15–25 year term. The developer handles DNO G99 connection, MCS-accredited installation, insurance, and 25-year operations and maintenance. At the end of the term, ownership usually transfers to the farm at a residual value, or the equipment is removed.
How much can a farm save with a PPA?
PPA discounts to grid retail typically run 35–45%. On a 200 kW dairy system self-consuming most of its generation, that is roughly £15,000–£20,000 per year of avoided grid cost with zero capital outlay — around £300,000–£400,000 over a 20-year term. The exact saving depends on your day-time baseload (the higher your self-consumption, the more PPA units you buy at the discounted rate rather than importing at full grid price). We model your specific saving from half-hourly meter data in the free assessment.
What size does my farm need to be for a PPA?
Most PPA developers have a minimum viable system size of around 250 kW, because the funding, legal, and connection costs need a certain scale to work. Farms with strong day-time electrical baseload are the best candidates — dairy parlours (24/7 cooling and milking), poultry and pig units (continuous ventilation), grain stores (harvest drying), and cold stores. Below ~250 kW, capital purchase with 100% Annual Investment Allowance or asset finance is usually the better route — see our full comparison.
Who owns the solar panels under a farm PPA?
During the PPA term the developer owns the panels, inverters, and associated equipment — that is what lets them fund the whole system. You own the electricity you buy and the roof or land it sits on. At the end of the term (15–25 years), the standard options are: ownership transfers to you at a pre-agreed residual value, the PPA extends, or the developer decommissions and removes the system. Always check the end-of-term clause before signing.
Do I keep the Smart Export Guarantee (SEG) income under a PPA?
Usually not. Under most farm PPAs the developer retains the Smart Export Guarantee income from surplus generation exported to the grid, because they own the system and that export revenue is part of how they fund it. If you buy the system outright (with 100% AIA) or via asset finance, you keep both the self-consumption savings and the SEG export income. This is one of the key trade-offs in the PPA-vs-buy decision.
Can tenant farmers use a solar PPA?
Yes, but it requires landlord consent because the PPA is a long-term agreement attaching equipment to the holding for 15–25 years. The developer, the tenant, and the landlord (or their agent) typically sign a tripartite agreement or a lease addendum. We routinely manage this conversation with institutional and family-estate landlords. See our tenant-farmer solar guidance for the consent process.
Does a PPA affect my Annual Investment Allowance?
No — because you do not buy the asset under a PPA, there is no capital expenditure to claim Annual Investment Allowance against. AIA is only relevant if you purchase the system (outright or via asset finance), where an incorporated farm can deduct 100% of the cost against trading profit in year one. If your farm is profitable and can use the tax relief, buying often beats a PPA on lifetime economics; if you lack the capital or prefer zero risk, a PPA wins. We model both.
What is the DNO G99 process for a farm PPA?
Any farm solar system above 3.68 kW per phase needs a G99 connection agreement from your Distribution Network Operator (NGED, SSEN, SP Energy Networks, Northern Powergrid, UK Power Networks, or Electricity North West). Under a PPA, the developer manages the entire G99 application and any associated grid-connection or export-limitation works. Timelines are typically 65–90 working days for the technical study and 6–18 months for full connection on rural feeders — the developer carries this risk, not you.