Reference
UK commercial solar glossary
Short, precise definitions of the terms that come up in a commercial or agricultural solar decision. That includes grid connection, certification, export schemes, financing and tax treatment.
This glossary explains the terms that come up most often once a business or a landowner starts looking seriously at solar. Grid connection applications use codes like G98 and G99. Tax rules use phrases like special rate expenditure and the Annual Investment Allowance.
None of this language is hard once it is explained plainly, but it is easy to misread if you have not met it before. Because these terms shape real decisions — how a site connects to the grid, what a contract says, what a tax return claims — getting one wrong can be costly. That is why we define each one in plain English, rather than the dense wording a spec sheet or a policy document normally uses.
The terms below are not sorted into separate sections, since a lookup list works better as one continuous run you can scan quickly. Even so, they fall into a few natural groups. Several cover grid connection and technical design, such as G98, G99, the DC/AC ratio and degradation rate.
Several more cover certification and installation standards, for example MCS and MIS 3002. The rest cover money: export tariffs, power purchase agreements, capital allowances, and reporting duties such as SECR. Whichever term brought you here, each definition stands on its own, so you can read just the one you need without working through the rest of the list.
- G98
- ENA Engineering Recommendation for the simplest UK grid connections. It covers generation up to 16A per phase (3.68kW single-phase, around 11kW three-phase). Since installers notify the DNO after commissioning, rather than applying beforehand, this fast-track route suits small rooftop systems.
- G99
- ENA Engineering Recommendation for connecting larger-scale generation to the local distribution network. It covers systems above the G98 threshold, up to 1MW and beyond. Connection requires a formal application and DNO approval, including a technical assessment for larger systems. In contrast, G98 only requires installers to notify the DNO after commissioning.
- DNO (Distribution Network Operator)
- The DNO is the regional company that owns and operates the local electricity wires and substations. A solar installation connects into this network. For example, UK Power Networks and National Grid Electricity Distribution are both DNOs. DNOs process G98/G99 applications and confirm how much grid capacity, if any, is available at a site.
- MCS (Microgeneration Certification Scheme)
- The UK quality assurance scheme certifying installers and products for small-scale renewables, including solar PV. Since most funders, insurers and the Smart Export Guarantee require an MCS-certified installer, this certification matters from the earliest planning stages. The installer must work to the relevant MCS installation standard.
- MIS 3002
- The MCS technical standard for solar PV installation. It covers system design, structural fixing, electrical safety and handover documentation. Referencing MIS 3002 in a specification lets a buyer compare installer tenders on a genuinely like-for-like technical basis.
- Smart Export Guarantee (SEG)
- An Ofgem-overseen scheme. It requires licensed electricity suppliers above a customer-number threshold to pay small-scale generators for electricity exported to the grid. Specifically, eligible generators include solar, wind, hydro and AD, up to 5MW. Suppliers set their own rate and contract terms, which must always be above zero.
- Feed-in Tariff (FIT)
- A UK government scheme that paid small-scale renewable generators for electricity generated and exported. It closed to new applicants from 1 April 2019. Existing accredited installations still receive payments for their remaining eligibility period, typically 20 years, index-linked to RPI.
- Agrivoltaics
- Combining solar generation with continued agricultural use of the same land. Crops grow beneath or between rows of panels, or livestock graze around them. As a result, land keeps producing food while also generating income and power. The two uses don't have to compete.
- PPA (Power Purchase Agreement)
- A contract under which a third party installs, owns and maintains a solar system on a customer's roof or land. The customer buys the electricity it generates, at an agreed rate usually below grid price. This runs over a fixed term, commonly ten to twenty-five years. Meanwhile, the customer pays no upfront capital outlay for the system itself.
- Annual Investment Allowance (AIA)
- A UK capital allowance letting a business deduct qualifying plant and machinery spend against taxable profit. It applies in full, in the year of purchase. The cap is up to £1 million a year, and it includes solar. However, the business shares that cap across all qualifying spend in the accounting year, not solar alone.
- Special Rate Pool / Special Rate First-Year Allowance
- Solar panels count as 'special rate' spend under HMRC's capital allowances rules (CA22335), not main-rate plant and machinery. As a result, they do not qualify for 100% Full Expensing. Spend above the AIA cap instead gets a 50% special rate first-year allowance. The business writes down what's left at 6% a year in the special rate pool.
- Ground-mount
- A solar array installed on frames fixed into open land rather than a roof. This suits sites where roof space is limited or unsuitable. It's also the usual choice for larger solar farms. Ground-mounted commercial-scale arrays generally need full planning permission, because permitted development rights for ground-mounted solar are very limited.
- Rooftop / BIPV
- Rooftop solar mounts panels on an existing roof structure — the most common form of commercial solar. BIPV (Building-Integrated Photovoltaics) works differently. It replaces conventional building material — roof tiles, cladding or glazing — with a product that also generates electricity.
- kWp vs kW
- kWp (kilowatt-peak) is a solar panel's rated output under standardised test conditions — the figure used to describe system size. kW (kilowatt), in contrast, is the actual power output or demand at a given moment. It varies with sunlight, temperature and time of day, and is almost always lower than the kWp rating.
- Self-consumption
- The share of solar generation used on site immediately, rather than exported to the grid. Higher self-consumption generally improves payback, because it offsets electricity bought at the retail rate. That rate is usually higher than any export tariff. For this reason, installers often size systems against daytime demand to maximise it.
- Export tariff
- The rate paid for solar electricity a site generates but doesn't use, and instead feeds into the grid. The Feed-in Tariff closed to new entrants, so this is now typically a Smart Export Guarantee rate. The chosen licensed supplier sets that rate. Alternatively, the parties may agree a rate instead under a private PPA.
- Agricultural Land Classification (ALC)
- Natural England's system grades farmland from Grade 1 (excellent) to Grade 5 (very poor). Grade 3 splits further into 3a and 3b. Grades 1 to 3a count as 'Best and Most Versatile' land. Consequently, planning policy generally steers ground-mounted solar away from it, toward lower grades where possible.
- Permitted development rights
- Rights under the General Permitted Development Order letting certain building work proceed without a planning application. Most rooftop solar on non-domestic buildings qualifies, subject to height and heritage limits. However, ground-mounted arrays have much tighter permitted-development limits, so most solar farms need full planning permission.
- DC/AC ratio
- The ratio of a system's total DC panel capacity to its inverter's AC output rating. Also known as the inverter loading ratio. Commercial systems are typically oversized to a ratio of roughly 1.1–1.3. That's because adding panel capacity usually costs less than adding inverter capacity, and losses only occur at rare peak-output moments.
- Inverter
- The equipment that converts direct current (DC) electricity solar panels produce into alternating current (AC). Buildings and the grid use this AC power. Inverters typically need replacing once or twice across a system's operating life. As a result, they're a routine line item in long-term maintenance budgeting.
- Degradation rate
- The gradual decline in a solar panel's power output over time. It typically runs around 0.3–0.5% a year for modern crystalline silicon panels. Manufacturer performance warranties commonly guarantee 80–90% of original output at 25 years. This rate is a standard input to long-term generation and payback modelling.
- Structural loading / dead load
- The additional permanent weight panels, mounting frames and cabling add to a roof or ground structure. A structural survey confirms whether existing purlins, trusses or foundations can safely carry this extra dead load. As a result, this is often the first thing that rules a site in or out before any other assessment.
- SECR (Streamlined Energy and Carbon Reporting)
- SECR is a UK requirement for large companies and LLPs. Specifically, it applies to those exceeding two of: £36m turnover, £18m balance sheet, or 250 employees. These organisations must disclose UK energy use, associated greenhouse gas emissions and an intensity ratio. They must also detail efficiency actions in their annual directors' report.
- ESG (Environmental, Social and Governance)
- A framework investors, lenders and customers use to assess a company's environmental impact, social conduct and governance practices. Companies commonly report on-site solar generation as evidence under the environmental pillar. However, this sits alongside — not instead of — mandatory disclosures such as SECR.
- Net zero
- A state in which an organisation cuts its greenhouse gas emissions as far as possible. It balances any that remain with removals, so net emissions come to zero. Solar is one lever toward net zero, alongside energy efficiency, storage and green procurement — rarely sufficient on its own.
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