Solar Carport ROI and Payback in the UK: Typical Ranges

Simple payback: 4-7 years

Typical simple payback for a UK commercial solar carport falls in the range of 4 to 7 years. Payback is shortest on sites with a high daytime load, such as supermarket retail, and longest where the array is reduced, for example on a heritage-sensitive site. These are indicative ranges; the figure for a given site comes from a site-specific model.

After-AIA payback: 3-5 years

For a company paying corporation tax at 25%, AIA reduces the effective capex by 25% (corporation tax saved on capex written off). After-AIA payback therefore typically falls to roughly 3-5 years, shortest on sites that self-consume nearly all of their generation.

Internal Rate of Return (IRR): 14-22%

Indicative pre-tax IRR for a commercial solar carport is in the range of 14% to 22%, and 20-28% after tax (including AIA), against a typical corporate cost of capital of 8-12%. These are illustrative modelled ranges, not a measured track record; a site's own IRR depends on its self-consumption, tariff and capex.

Net Present Value over 25 years: 4-8× capex

Discounted cashflow at 8% discount rate over 25-year asset life — an indicative NPV is 4-8× initial capex. As an illustration with assumed inputs, a £400k carport with £170k/yr saving and 2% RPI escalator gives a 25-year NPV of ~£2.4m at 8% discount.

Sensitivity: what changes payback most?

Indicative sensitivities, which vary by site. Most-sensitive variables ranked: (1) Self-consumption rate — every 5% increase reduces payback by ~0.4 years; (2) Electricity unit rate — every 5p/kWh increase reduces payback by ~0.6 years; (3) Capex per kWp — every £100/kWp reduces payback by ~0.3 years; (4) Annual yield — every 50 kWh/kWp/yr increase reduces payback by ~0.4 years; (5) AIA availability — adds ~25% capex savings in year one.

Illustrative example: 300 kWp university carport

A hypothetical scheme with assumed inputs, not a quote. Capex: £290k. AIA tax saving: N/A (HE non-profit). Modelled on capital repaid from the energy saving over seven years (PSDS closed to new applications in November 2024 and Salix programmes are nation-specific); monthly repayments £3,450 × 84 = £290k. Annual saving (88% self-consumption × 47p/kWh × 224,000 self-consumed kWh + 31,000 exported × 12p SEG): £109k. Year 1 net cashflow: +£68k (£109k saving minus £41k repayments). Year 8+: +£109k/yr clean cashflow for ~17 remaining years. 25-year total benefit: ~£2.0m.

Related reading: how the AIA applies to a carport · bifacial car park panels · school and university car parks.