Community energy and PPAs for schools

Not every school wants to spend capital on solar, and not every trust wants a new asset, a maintenance liability and a grid connection to manage. For those schools there is a well-established alternative to buying: the power purchase agreement (PPA), often delivered through a community energy organisation. Under this model the school does not own the panels and does not pay for them. A third party funds, installs, owns and maintains the system on the roof, and the school simply buys the electricity it generates — at a fixed price per kWh set below the grid rate. The bill falls, no capital is spent, and the maintenance risk sits with the funder.

How the PPA model actually works

The mechanics are straightforward. A funder — an investor, a specialist solar developer or a community benefit society — pays the full capital cost of the array. They own it for the term of the agreement, typically 15 to 25 years, and they are responsible for keeping it running. The school signs an agreement to buy the electricity the panels generate at an agreed rate that is cheaper than what it currently pays the grid. Because the funder earns its return from selling that electricity, the incentives line up: they want the system generating well, and the school wants a lower bill. At the end of the term, ownership usually transfers to the school — so it eventually gets the asset for nothing. You can read the specifics of how this is structured for schools and academy trusts at solarpowerpurchaseagreements.co.uk.

Community energy: bringing the town onto the roof

A community energy scheme is a particular flavour of PPA. Instead of a single investor, a locally-owned community benefit society raises the capital through a community share offer — local people buy shares to fund the project. The society owns the array, the school buys the electricity below grid price, and any surplus typically flows into a community benefit fund for local causes. For a school this is more than a funding route: it is a community-engagement and governor story, a way to involve parents, the parish and the local area in the school’s energy project, and it dovetails naturally with the curriculum angle that already makes school solar attractive.

PPA versus buying outright

It helps to see the two main no-money-down routes side by side. Buying outright, the school pays from its own capital and owns the system — it is capital on the books, the school owns the asset from day one, and it keeps every kilowatt-hour of saving. There is no Salix loan for English schools, so the capital has to come from the school, the trust or the local authority. With a PPA the school commits no capital, owns nothing during the term, and pays only for the electricity. Buying maximises the long-run saving and gives you ownership; a PPA maximises simplicity, requires no capital and no borrowing, and moves the maintenance and grid-connection risk to the funder. Neither is universally better — see our honest breakdown of funded, zero-net-cost routes alongside this one.

When a PPA suits a school or trust

A PPA tends to suit a school or multi-academy trust that wants the bill saving and the net zero progress but needs to protect its capital and its borrowing headroom for teaching priorities. Because the school neither owns the asset nor borrows to fund it, a well-structured PPA can be treated as off-balance-sheet — though this depends on the exact terms and the accounting treatment, so it must be confirmed with your finance team or auditor rather than assumed. For a trust weighing capital allocation across many schools, that off-balance-sheet potential, plus the transfer of ownership and maintenance risk to the funder, is often the deciding factor. Where a school has the capital and wants to own the asset and keep the full long-term saving, buying is usually the stronger call. A good installer should model both routes on your real numbers so governors decide on evidence — start with a free assessment.

Can schools get funding for solar panels?

Yes, and the live routes in 2026 are narrower than most guides suggest. In England the direct route is the Great British Energy Solar Partnership: 245 schools and colleges already have government-funded solar, a further 100 schools were backed with up to £40m in July 2026, and the Partnership is worth up to £255m across schools, colleges, NHS and military sites — but it is allocated by selection, not open application. Academies, sixth-form colleges and voluntary-aided schools can bid into the annual Condition Improvement Fund, where solar scores best packaged with a roof refurbishment. The Public Sector Decarbonisation Scheme is not currently open: its Phase 4 window closed in November 2024 and no new window had opened as of September 2026. For every other school — and for any trust that wants the saving without the capital — the PPA and community energy models on this page put panels on the roof with nothing to pay upfront. The full picture, route by route, is on our grants and funding page, and the no-capital angle is explored on free solar panels for schools.

How much would solar panels cost for a school?

The figures a PPA is being compared against matter, so here is the buying benchmark from our school solar cost guide. A primary school at 30 to 80 kW is typically £35,000 to £90,000 installed with a payback of around seven years; a secondary at 100 to 300 kW runs £90,000 to £270,000 at roughly 6.5 years; a special school at 40 to 150 kW is £45,000 to £135,000 at about 7.5 years; and a trust-wide programme of 200 kW to 1.5 MW spans £250,000 to £1.5m or more. Cost per kW falls with scale, from £900 to £1,200 below 100 kW to £750 to £950 in the 150 to 400 kW band. Under a PPA the school pays none of that capital — the trade is that the funder keeps the asset, and most of the saving, for the 15 to 25 year term. That is the comparison the tool below runs on your own numbers.

The Great British Energy PPA pilot: no-upfront solar backed by government

On 16 July 2026 the government announced that 150 schools and colleges across Yorkshire and the Humber, the East Midlands and the South East would pilot exactly the model described on this page: a private-sector partner installs and maintains the panels at no upfront cost, and the school buys the electricity at a rate below its grid tariff. The pilot is designed to inform a national rollout in 2027 to 2028. The same announcement put numbers on the prize — a secondary school with solar and LED lighting saving around £58,600 a year and a primary around £21,000 — and, in the first wave, LIFT Feversham School saved roughly £23,000 in its first year. If your school is outside the three pilot regions, a commercial PPA or a community energy society offers the same structure now; our Great British Energy application guide explains who is selected and how to get ready.