500kWp PPA — UK 2026 indicative cost & PPA tariff

2026 indicative numbers

System size	500kWp PPA
Indicative capex (cash)	£395,000–£500,000
PPA tariff (year 1)	11–14 p/kWh
Annual generation	475,000 kWh
Indicative annual saving	£52,250+ (vs 24 p/kWh grid)
Typical audience	Large factories, refrigerated distribution, NHS Trust acute sites, university campuses, food processors.
Off-taker requirement	20+ year tenure, £180k+ annual electricity spend, investment-grade off-taker

Grid import benchmark: 21–25 p/kWh for Medium to Extra Large non-domestic consumers (all-band average 24.14 p/kWh). Source: DESNZ Quarterly Energy Prices, table 3.4.2 (including CCL, excluding VAT), Q1 2026, published 30 June 2026. Re-verified 1 September 2026.

Half a megawatt is an infrastructure decision

By 500kWp a solar PPA behaves less like an energy purchase and more like a piece of site infrastructure that someone else has funded. The £395,000–£500,000 install would be a board-level capital request if bought outright; under a PPA it lands as an operating cost against the roughly 475,000 kWh generated each year, at 11–14 p/kWh. The off-takers at this scale — large factories, refrigerated distribution, NHS acute sites, universities, food processors — tend to carry the steady, high daytime demand that makes the array pay.

Metering and structure need real diligence

Sites this size sit on half-hourly metering, so a provider models your consumption profile in genuine detail rather than off an annual bill. Two things get tested hard: whether the roof can bear the array for a quarter-century — a structural survey is standard, and remedial work can be a precondition — and how much of the 475,000 kWh you actually self-consume versus export. Refrigerated and process loads score well, because demand runs around the clock.

The covenant bar is high

A 20-to-25-year contract of this value needs a strong counterparty. Expect a requirement for an investment-grade off-taker and yearly electricity costs above £180,000. Public-sector and institutional buyers clear that comfortably; a private operator may need audited accounts or group support to get there.

• Investment-grade off-taker covenant
• A 20-to-25-year contract horizon
• Electricity costs above £180,000 each year
• Structural roof survey passed or remediation agreed

How to run the process

Get the sequence right and a 500kWp PPA is undramatic. Learn how an on-site PPA actually operates, size the opportunity with the savings estimator, then shortlist funders with a track record at this scale through the directory of providers.