Distribution centre solar cost: how to benchmark a quote

A solar installation on a distribution centre is a capital project that can pay for itself over time. The honest answer to what it costs is that it depends on how big your roof is, how much electricity you use during daylight, and how you choose to fund it. This page gives a method and the inputs we can source rather than a price list, because no published price series covers 1 to 5 MW rooftop installations.

Benchmarking a quote: cost per kW

The most useful way to benchmark a distribution-centre solar quote is cost per kilowatt of installed capacity, taken from at least three written quotes for the same roof. Larger systems usually cost less per kW because fixed costs such as scaffolding, design, grid connection and mobilisation spread across more panels. We do not publish a price band, because no published price series covers 1 to 5 MW roofs. The nearest government source is the DESNZ solar PV cost data, which covers MCS systems up to 50 kW: its 2025/26 mean for 10 to 50 kW systems in Wales was £1,257 per kW, including VAT where applicable. Treat that as a reference point, not a price for a distribution centre. If one quote sits well above the others, ask what is driving it: a re-roof, a long cable run to the intake or a constrained grid connection are the usual reasons, and each should be itemised rather than buried in a single headline figure.

What drives the variation

Two distribution centres of the same floor area can carry very different solar costs. The roof is the first variable. Modern profiled-steel and single-ply membrane roofs take ballasted or clamped mounting systems quickly and cheaply. Older buildings with asbestos-cement roofs usually need a specialist assessment and often a re-roof before panels can be fitted, and the right move is often a combined re-roof plus PV where the energy saving helps fund the new roof; the HSE has guidance on asbestos. Sprinkler systems are the second variable: every layout should be designed to LPC clearance standards with insurer sign-off before fabrication, which costs design time but avoids the far larger cost of a rejected install.

Electrical infrastructure matters too. Many distribution centres have generous existing capacity inherited from heavy industrial use, which keeps connection costs down. Others need a larger transformer or a contestable connection, which a half-hourly meter assessment and a DNO budget estimate will flag early. Wind exposure drives ballast weight under BS EN 1991-1-4, and coastal or estuary sites need marine-grade fixings that add a little to the bill but a lot to the life of the system.

Hidden costs to check in any quote

A fair distribution-centre solar quote includes the structural survey, the G99 grid connection application and any DNO works, scaffolding or mast-climber access, the inverter and switchgear, monitoring, commissioning, and the insurance-backed workmanship warranty. The costs that catch people out are the ones left off cheap quotes: a re-roof where the existing covering will not last the panels' 25-year life, a DNO reinforcement charge on a constrained network, or out-of-hours working to avoid disrupting a 24-hour operation. All of these should be priced in from the start so a fixed-price proposal is genuinely fixed.

How distribution centres fund solar

There are three routes, and the right one depends mostly on whether you own or lease the building.

Cash purchase with capital allowances. If you own the building and have the capital, buying outright gives the strongest lifetime return. Solar PV is plant and machinery and is normally special-rate plant, so the Annual Investment Allowance covers the first £1m a year of qualifying spend (a limit shared with other plant spend and associated companies), spend above it attracts a 50% first-year allowance, and full expensing does not apply. A worked example: a £1.5m scheme gets £1m under the AIA plus a 50% first-year allowance on the other £500,000, so £1.25m is deducted in year one and £250,000 goes into the special-rate pool. At the 25% main rate of corporation tax the year-one deduction is worth about £312,500, if the company has the profit and has not used the AIA elsewhere. It is an illustration, not tax advice.

Asset finance. Spreading the cost over five to seven years keeps capital free for the core business. For a distribution centre with high daytime load, the monthly finance payment can be lower than the monthly electricity saving, which keeps the project cash-flow positive while you still build equity in the asset and claim the allowances.

Power purchase agreement. For tenants on shorter leases, or owners who want zero capex and an off-balance-sheet structure, a PPA puts a third party in to own and operate the array. You simply buy the electricity it generates at a fixed rate below grid retail. There is no upfront cost, the PPA provider takes the technical and lease risk, and you lock in price certainty against volatile wholesale markets.

Reading payback the right way

Simple payback is the installed cost divided by the annual saving, and it is the figure most people quote. The saving rests on three inputs you can check. Generation: PVGIS gives about 886 to 1,042 kWh per kWp per year for the six cities we have checked (Manchester lowest, Cardiff highest) for a south-facing array at 35 degrees, and a low-tilt flat-roof array typically yields a few per cent less. Self-consumption: the share of output used on site comes from your half-hourly meter data, and every unit used on site avoids the price you would otherwise pay, while exported units earn only the supplier's Smart Export Guarantee tariff. Price: take the avoided cost per kWh from your own bill, not a national average.

Simple payback also ignores the years of generation after the system has paid for itself, so ask for a discounted cash flow or internal rate of return with the assumptions listed and a sensitivity to your own tariff. Be wary of any payback, IRR or "free electricity" claim that does not show those inputs. Our savings calculator lets you try your own numbers. For a longer read on what moves the number, see distribution centre solar payback: what moves it.

Cost versus the grid

The reason these numbers work is the gap between the cost of self-generated solar and the cost of grid electricity. A distribution centre buying power at retail rates, plus the TNUoS and BSUoS network charges, is paying far more per kWh than a paid-off rooftop array delivers. Every kilowatt-hour you self-consume from your own roof is a kilowatt-hour you do not buy at the worst of those prices. On a 24-hour site that self-consumes most of what it generates, that is where the saving comes from.

What happens next

The fastest way to get a real number for your site is to gather your half-hourly meter data and roof drawings. A supplier's first-pass model should cover the system size, the generation, the self-consumption and the financials, and can be done without a site visit. If the numbers work, expect a structural and electrical survey, then a fixed-price proposal with yield modelling and a discounted cash flow. Send your site details through the form and we reply by email. See our grants and funding guide for the capital allowances and finance routes in detail, then request your free quote.