Renting a house with solar panels: What UK landlords should explain to tenants

It comes as no surprise that energy efficiency remains a focal point for the UK private rented sector; there are more rental properties than ever that are fitted with solar PV panels. Installing solar generation is one of the most effective ways to boost your rental property’s energy performance. It also helps lower carbon footprints, resulting in a higher EPC rating for your rental property. Renting a house with solar panels is the future for your property rental business. 

Fitting the solar panels to your property, however, is only half the battle, and when it comes to renting a house with solar panels, some landlords assume tenants will automatically understand how it works and how it will affect their monthly bills. 

If your tenants aren’t aware of how solar panels work, it can quickly lead to mismanaged energy habits and potentially avoidable disputes at the end of the tenancy. Here, we’ll outline the practical details that you need so that you can explain the process to your tenants. This way, you’ll ensure a smooth, transparent tenancy. 

How Do Solar Panels Impact Tenant Electricity Bills?

One of the main reasons tenants like renting a house with solar panels is the reduction in energy bills. Tenants need to understand, however, that this doesn’t mean they won’t pay for energy at all, nor does it completely disconnect the property from the National Grid. 

Free Energy During Peak Daylight

The first thing you’ll need to explain to your tenants is that the property will generate electricity mostly during daylight hours, peaking between late afternoon and early morning. It will be during these hours that any electricity consumed inside the house is drawn directly from the solar panels, and anything after this will be directly from the grid. 

So, in order to maximise these savings, tenants should be encouraged to change their daily energy habits. Small changes can lead to noticeable bill reductions, for example: 

• Running domestic appliances during sunny daylight hours, such as tumble dryers, dishwashers, and washing machines
• Charging electric vehicles and household appliances during the afternoon rather than overnight. 
• Using appliances separately throughout the day so that power consumption doesn’t exceed what the panels generate at any single moment.

The Role of the Grid Backup

Solar generation fluctuates depending on the season and weather conditions. So, on an overcast day during winter or at night, the property will automatically draw its power from the National Grid. 

So, because of this, tenants will need to have an account with an energy provider, and they will continue to receive a monthly bill for the power the property consumes when the solar output is insufficient. 

Smart Meters

The best way to track energy consumption is with smart meters because this means that both tenants and energy suppliers are able to see the real-time usage and generation data. Read our guide on why you need to get a smart meter in your rented property if your property is still relying on legacy meters. 

Managing Exported Energy, Batteries, and the Smart Export Guarantee (SEG)

So, what actually happens to the extra energy that is generated but not actually used in a rental property? 

Smart Export Guarantee (SEG)

In the UK, small-scale generators can receive payment for excess renewable energy that is exported back to the grid. This is done through the SEG, so you’ll need to be able to clarify who registers for the SEG tariff and where the payments go. 

• Landlord-managed SEG: In most private rental agreements, you’ll own the solar infrastructure, hold the Microgeneration Certification Scheme (MCS) documentation, and register for the SEG tariff to offset maintenance costs or to reinvest in the property. 
• Tenant-managed SEG: There may be some long-term tenancies where the utility contracts are in the tenant’s name. The tenant may apply for an export tariff directly if permitted by the tenancy agreement.

So, whichever arrangement you choose, always make sure that you’re transparent with your tenants. If you decide to retain the SEG export revenue, make sure that you communicate this with your tenants before the tenancy agreement starts, so that tenants won’t assume they will receive cash payments for unused power. 

What If the Property Has Battery Storage?

If your rental property has a solar installation that includes a home battery system, you need to make sure you know how it works. A solar battery stores any excess daytime generation so the tenant can use green energy in the evening after sunset. 

Make sure that you explain that a battery reduces grid reliance significantly during peak evening tariff hours, but also advise them on basic operational boundaries, for example, avoiding manual overrides or tampering with inverter settings. 

Clear Handovers and Setting Expectations

As you may already know, a successful tenancy always begins with an efficient onboarding process. Making sure that you take a few proactive steps during inventory check-in will definitely save you hours of troubleshooting later. Here’s how: 

Accurate Meter Readings at Handover

When you hand over keys to your tenants, make sure you always record these three separate figures if relevant: 

1. Standard mains import meter reading: to be able to establish the tenant’s starting point for grid electricity. 
2. Solar generation meter reading: to be able to log the lifetime output of the inverter/panels. 
3. Export meter reading: to be able to record the exact benchmark for exported units. 

Having accurate records allows for both landlords and tenants to be protected, especially when it comes to void periods and tenant transitions. Make sure you read our guide on landlord utility bills between tenants for more information on how to manage standing charges and energy accounts. 

Provide Guidance

Make sure that the guidance you offer your tenants is easily digestible by creating simple one-page guides that answer commonly asked questions, for example: 

• Where is the solar inverter located?
• What do the status lights on the inverter mean?
• Which mobile app or display unit can they check to see live generation?
• What steps should they take if the main circuit breaker trips?

Incorporating Green Tenancy Provisions

Being able to communicate these expectations around the usage of energy can form a part of a broader sustainability strategy when renting a house with solar panels. Read our guide on what green leasing is if you’re interested in aligning environmental goals with your tenancy agreement. 

Landlord Responsibilities vs. Tenant Access Rights

Here’s a comparison between your responsibilities as a landlord and the responsibilities of your tenants. Being able to distinguish between the two is crucial in managing expectations and maintaining boundaries. 

Landlord Maintenance Obligations

As the landlord, you’ll remain responsible for the ongoing structural safety, maintenance, and electrical compliance of your solar system, for example:

• Organising periodic electrical testing by a qualified technician.
• Addressing fault codes on the solar inverter.
• Maintaining roof integrity around solar mounting frames.

Make sure that you provide the statutory written notice before visiting the property when maintenance inspections are required. 

When you’re able to communicate clearly while renting a house with solar panels, it becomes an advantageous agreement between you and your tenants. Your tenants will enjoy lower daily utility bills and a reduced carbon footprint, while you benefit from higher tenant retention rates, as well as improved energy compliance and enhanced property value. 

Are you looking for landlord insurance to help protect your rental property? Be sure to get in touch with our team of specialists for a quote today on 01788 818 670, or you can visit our advice centre for more information on how to manage your rental property.