The benefit case behind the funding case
The headline grant numbers — 30% IETF, 100% PSDS, 40% REPF — are real but they are scaffolding around the underlying benefit case, not a substitute for it. A grant that takes a 9-year payback to 6.5 years still leaves you with a 6.5-year payback project. The decision to proceed is made on the underlying benefit case; the grant just adjusts the IRR.
For most commercial solar projects in 2026, the benefit case is straightforward. UK grid prices are unlikely to fall back to pre-2022 norms in the foreseeable future. Module prices are at historic lows. Tax allowances are as generous as they have ever been (the Annual Investment Allowance made permanent in Autumn Statement 2023). The combination produces project IRRs in the 14-22% range for typical commercial sites — comfortably above most internal hurdle rates.
What grants and tax allowances change is the speed at which the benefits accrue. Without grant or tax relief, payback is typically 5-8 years on a UK commercial solar project. With the Annual Investment Allowance alone, that drops to 3.5-6 years. With grants on top (where eligible), payback can hit 3-4.5 years on the strongest sectors and configurations. The benefits are the same; the route to them is faster.
What undermines the benefit case
Three things most commonly degrade the benefit case in practice. First, oversizing — installing more capacity than the site can self-consume, which collapses self-consumption rates and shifts revenue to lower-paying SEG export. Second, weak system design — choosing the lowest installer quote without checking inverter sizing, mounting structural integrity, or panel quality, which produces 5-15% lower yields than properly engineered systems. Third, ignoring DNO costs — non-contestable network reinforcement charges that can add £8,000 to £180,000 to project capex unexpectedly.
These are all preventable with proper scoping. The free funding review includes a financial model that catches all three before any contracts are signed.