Solar on Leased Premises: Benefits and Challenges for Business Tenants
Rising energy costs and climate commitments are prompting many businesses to consider installing solar panels — and sometimes batteries — to reduce operating costs and greenhouse gas emissions. For businesses that lease their premises, solar can still be a strong option, but it does come with additional considerations.
The Benefits For Tenants
Installing solar can significantly reduce electricity purchased from the grid, helping businesses manage energy costs over the long term. For energy-intensive operations, this can translate into meaningful savings and improved business resilience. Solar also reduces a business’s carbon footprint, supporting sustainability targets, customer expectations, and reporting requirements.
In some cases, adding battery storage can further increase savings by storing excess solar energy for use later in the day, particularly during peak pricing periods.
The Challenges On Leased Sites
Leased premises introduce extra layers of complexity. The first step is confirming whether the site is suitable — including roof size, orientation, shading, and structural capacity. Multi-tenant buildings can complicate matters further, particularly around shared roof space, metering arrangements, and how energy benefits are allocated.
Landlord consent is essential, and this often requires clear discussions about technical requirements, installation standards, insurance, maintenance responsibilities, and end-of-lease arrangements. Businesses also need to understand who pays for the system upfront and whether upgrades to meters or electrical infrastructure are required.
Why Property Owners May Say Yes
While landlords can be cautious, solar installations are a permanent capital improvement. Once installed, panels are typically not removed, meaning the owner retains the asset. This can increase property value, improve energy performance ratings, and make the building more attractive to future tenants.
If a tenant is willing to fund the installation (justified by lower energy bills over time), this can significantly strengthen the case for owner consent. Clear agreements outlining ownership, maintenance, and future use of the system help reduce perceived risk for all parties.
Council, state, and federal government rebates or incentives may be available to help offset installation costs. These programs change regularly, so it’s worth seeking up-to-date advice before making a decision.
Support And Incentives
Council, state, and federal government rebates or incentives may be available to help offset installation costs. These programs change regularly, so it’s worth seeking up-to-date advice before making a decision.
Check out the BBP Local Government Area Rebates and Assistance page HERE.
The Bottom Line
Solar on leased premises is achievable, but it works best when tenants and owners see it as a shared opportunity rather than a risk. With early planning, clear communication, and a strong business case, solar can deliver long-term financial and environmental benefits for both parties.
Now is the time to open the discussion and turn solar from an idea into a shared opportunity.
If you would like guidance on Solar Power for your business, the Better Business Partnership team can help assess your options and identify practical next steps.