Last-Mile Depots: Solar panels for distribution centres

Why a last-mile depot pairs solar and EV charging better than any other site

The last-mile depot is the building where solar and electrification meet most neatly. These sites exist to dispatch and recover delivery vehicles, and as those fleets shift to electric vans the daytime demand for charging power climbs steeply, just as the panels overhead are at their most productive. Vans that load and depart in the morning and return through the afternoon can be topped up from on-site solar at close to 100% self-consumption, turning the roof into a fuel source for the fleet. That synergy is the reason a last-mile depot is such a strong solar case even at a smaller scale than a full distribution centre, with a typical simple payback of around 5.5 years and a strategic value that goes well beyond the electricity bill.

Last-mile is also where the national parcel and post operators are pushing hardest on decarbonisation, and many depots form part of programme-level rollouts across a carrier's estate. That means a solar and charging scheme at one depot is often a template for many, and the customer pressure that runs through every parcel network rewards operators who can show clean, self-generated power feeding an electrifying fleet. For an operator standardising depots across the country, getting the solar and charging design right once and repeating it is a meaningful prize, because the design effort amortises across the whole programme rather than being repeated site by site.

The economics also read slightly differently from a large warehouse. A last-mile depot is a smaller building, so the absolute capital is lower and the decision is easier to take quickly, but the strategic value of pairing solar with fleet charging is disproportionately high. Every electric van charged from the roof is a van not drawing from the grid at network-charge-inflated rates, and the network charges that have risen sharply since 2022 apply to depot charging just as they do to any other import. Solar turns a rising fleet-charging cost into a largely fixed one, which is exactly the kind of certainty a depot manager planning a multi-year EV transition is looking for.

What a typical install looks like and how we size it

For a last-mile depot we usually design a system in the 100 to 400 kW range, which is roughly 185 to 740 panels across about 600 to 2,400 square metres of roof. A system that size generates in the region of 92,000 to 370,000 kWh a year and saves somewhere between 21 and 85 tonnes of CO2 annually. Sizing on a last-mile depot is driven by two loads that increasingly merge: the building baseload of lighting, sortation and welfare, and the EV charging demand of the van fleet. Because daytime charging absorbs solar at almost full self-consumption, we size the array around the charging profile as much as the building.

We design the EV charging infrastructure alongside the PV rather than as an afterthought, because the two share a grid connection and have to be planned as one system. A typical depot scheme pairs 100 to 400 kW of solar with a bank of charge points, often in the range of six to twenty-four depending on fleet size, and we model the two together from half-hourly data so generation and charging line up through the working day. The art is in the timing: vans that depart in the morning and return through the afternoon present a charging window that overlaps the solar peak, so a well-designed depot can charge a large share of its fleet directly from the roof. Where the return pattern is concentrated into the evening, we assess whether a battery bridges the gap between midday generation and evening charging demand.

Costs, payback and tax relief

A last-mile depot project typically lands between £90,000 and £340,000 depending on roof area and charging scope, with a simple payback near 5.5 years and effectively free generation for the long life of the system thereafter. Because the building is smaller than a full distribution centre, the absolute capital is modest and the decision is one a depot manager or regional head can often take without a lengthy board process, which is part of why last-mile solar moves quickly once a programme is agreed. Tax relief is the main accelerator. Solar PV qualifies as plant and machinery, so the 100% Annual Investment Allowance writes qualifying cost off against profit in year one up to the £1m cap, with a 50% First Year Allowance above it under current legislation, and EV charging plant typically qualifies for capital allowances too, so a depot can often expense both the PV and the charging infrastructure in the same year. Where the fleet charges through the day, almost all generation is self-consumed, but on quieter days the Smart Export Guarantee pays for any surplus. Our cost guide works through depot economics including the charging element.

Funding routes in detail

Last-mile depots are frequently leased urban sites, so funding usually pairs a capital or finance route with a lease solution. Owner-operators buy or use asset finance and claim the full Capital Allowances, the 100% Annual Investment Allowance up to the £1m cap and the 50% First Year Allowance above it, covering both the PV and, in most cases, the charging infrastructure, since EV charging plant typically qualifies as plant and machinery in its own right. Tenants more often use a Power Purchase Agreement, which removes the capex and suits the shorter or programme-driven leases common in last-mile, with the lease itself enabled through the Green Lease Clause and Tenant Capital Recovery route and the Building Better Partnership toolkit addendum we provide.

Because depots are so often delivered as part of a national programme, the funding decision is frequently taken once at estate level and then applied across many sites, and we structure proposals to support that, with consistent assumptions a head office can compare and approve in one go. Some urban depots sit within a designated Freeport or Investment Zone, which can unlock Enhanced Capital Allowances on qualifying plant, so we check zone status for each site in a rollout. The Smart Export Guarantee pays 4 to 15p per kWh on surplus, which matters on lighter days when the fleet is out and the building load alone is small. The funding guide sets out each option and how they combine with the charging spend.

Compliance and sector considerations

The compliance picture for last-mile is shaped by its urban setting and its charging element. Urban planning is more involved than for a rural distribution centre, so we factor local planning into the programme rather than assuming Permitted Development will cover everything, although Class A Part 14 of the GPDO 2015 still applies to much of the rooftop PV. The EV charging infrastructure has to be designed alongside the PV, with the grid connection sized for the combined load, which is exactly why we treat solar and charging as one scheme rather than two projects sharing a roof.

The standard logistics framework still applies: LPC sprinkler clearances where present, with the array laid around the heads; insurer pre-design sign-off before fabrication, since the hardened insurance market applies to depots as much as to large sheds; wind loading to BS EN 1991-1-4 for the site exposure; and a G99 grid application above 17 kW per phase. The work is delivered under MCS commercial certification, NICEIC, RECC and TrustMark, with ISO 9001, 14001 and 45001 behind it, and BS 5839-1 where fire detection is integrated. On a smaller urban roof the grid connection capacity is often the item to confirm earliest, because the combined PV-plus-charging load can be significant relative to the building's existing supply, and we would rather establish that at the survey than discover it late.

How we approach this kind of project

We treat a last-mile depot as a combined solar and charging project from day one, because that is how the building actually works. We start with half-hourly meter data and the planned EV charging profile so the array, the charge points and the grid connection are sized as one system rather than three separate decisions that fail to add up. We address the urban planning position early, run the structural and roof checks before fixing a layout, and resolve the sprinkler and insurer position in parallel.

We submit the G99 application at the survey stage so the connection process for the combined load is underway from the outset, which on an urban site with limited spare capacity is often the deciding factor in the timeline. You receive a fixed-price proposal covering both the PV and the charging infrastructure, the workmanship carries an insurance-backed warranty, and where the depot is one of many we design the scheme to be repeatable across the estate so the carrier's programme team has a template rather than a one-off. Installation happens above the operation so van loading and despatch continue, with only the final grid synchronisation needing a scheduled window, typically four to eight hours over a weekend. The result is a depot that fuels its own fleet from its own roof, designed once and ready to repeat.

An illustrative example

As an illustrative composite based on typical UK last-mile projects: an urban parcel depot operating an electric van fleet on a daytime delivery cycle installed around 250 kW across the roof, roughly 460 panels generating in the region of 230,000 kWh a year, paired with a bank of charge points for the vans. With charging timed to the working day, daytime self-consumption was close to total, the qualifying cost for both the PV and the charging plant drew relief under the Annual Investment Allowance, and the payback landed near 5.5 years. Funded through asset finance with capital allowances claimed on both the PV and the charging plant, the scheme was designed as a repeatable template for further depots in the carrier's national programme. The figures are illustrative and depend on your fleet, charging pattern, roof and funding route.

If your network also includes larger ambient or automated sites, see distribution centre solar and fulfilment centre solar. When you are ready, request a free feasibility from your meter data, see the cost guide or read the depot solar FAQs first.