Shining the light on Solar Equity Release

By John Swindells 18 Oct 2019 | Comment
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I received a letter recently from a company offering to pay me a lump sum in return for the Feed-in Tariff (FiT) for my solar panels. It was addressed to "The Homeowner" and was from a company I'd never come across before. I read up on the basics of equity release for solar pv, and it is basically a way to swap long-term payments for an immediate cash sum.

This company was specifically not taking ownership (either by lease or outright) of any part of the solar system, but would maintain the system. This is called a "non lease offer". The point of this was to avoid complications with any mortgage on the property. So, in theory, their offer appears reasonable if you're in desperate need of need of some money - but rest assured that you'll be far better off in the long term if you continue to receive the feed-in tariff yourself. The only expense you should expect to incur from your pv system is a new inverter every 10 years or so, and these are several hundred pounds to replace - a very small proportion of your earnings from the system.

Even though there's claimed to be no issues with your mortgage provider, I can easily imagine that it would have a fairly negative impact on the attractiveness of your home on the market, if you decided to sell up within the lifetime of the solar tariff payments. Instead of telling a prospective buyer that they'd be able to earn a £1000 or more per year with very little hassle, you'd be having to tell them that some other company gets the income and also needs access whenever something goes wrong.... doesn't sound like much of a selling point, does it?

In summary, I wouldn't even consider any form of solar equity release if you aren't desperate for short-term cash. And if you were thinking of selling your house during the lifetime of the FiT contract, I'd really try to find any other way to drum up the cash.

On a side note, I am intrigued how these companies find out who to approach. My letter (and another one, offering free solar PV system health checks) was address to "The Homeowner" at my full address. Either I'm on a list of FiT homeowners that is somehow accessible to anyone, or they're scouring satellite maps for houses with solar panels on their roofs. Mapping data is so good nowadays that map views can reveal full addresses, so I suspect that it's the latter.

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