Small-scale solar

DOI: https://doi.org/10.58248/PN771

Solar photovoltaics (PV), commonly known as solar panels, convert sunlight into electricity and are the cheapest and fastest-growing form of electricity generation globally. Small-scale solar includes installations on domestic rooftops and balconies, and commercial, industrial and public buildings.

Rollout of small-scale solar

In the UK and worldwide, solar is the fastest growing electricity generation source. The UK Government’s Solar Roadmap calls for a ‘rooftop revolution’, with a total solar target of 45 to 47 gigawatts by 2030, compared to 18 gigawatts in 2025. In the UK, solar made up 10% of renewable generation in 2024, up from 0.2% in 2010.

Domestic rooftop systems typically produce around 3.5 kilowatts at their peak and cost £6,100 in 2026. Installation makes up a large share of the cost. Small-scale solar represented around 55% of installed UK solar capacity in 2025.

The Feed-in Tariff scheme increased installations between 2010 and 2016. Since 2020, the Smart Export Guarantee has provided payments for electricity exported to the grid. The Warm Homes Plan provides funding, grants and loans for domestic PV installations.

Installation barriers include upfront costs, suitability of roofs and planning considerations. There are split incentives in rented properties, where landlords usually pay for installations while tenants benefit from lower electricity bills.

There is potential for rooftop solar on commercial and industrial rooftops. The UK Warehousing Association said there was 15GW of available warehouse roof space for solar in 2022, but there are issues with ownership, rental agreements and grid connection.

Wider impacts

Physical issues relating to the amount of electricity that cables can carry are a common barrier to widescale solar rollout. It can be difficult for system operators to manage the electricity network efficiently due to a lack of comprehensive data on where small installations are situated.

Manufacturing, cost and supply chains

China holds more than 80% of manufacturing capacity across all stages of solar panel production, including polysilicon, wafers, cells and modules. Globally, due to oversupply, prices have fallen sharply, from ~$100 per watt in the 1970s to around ~$0.15 per watt in 2026.

There are some concerns about forced labour, particularly members of Uyghur and other minorities in Xinjiang, where some polysilicon manufacturing occurs.

Manufacturing in the UK and Europe is generally more expensive due to higher electricity, labour and capital costs. The UK Government does not expect to compete in large-scale manufacturing of conventional silicon PV but has identified potential roles in associated electrical equipment, alongside research into emerging technologies.

Current and future technology

Crystalline silicon accounts for around 98% of the global solar panel market. The current best performance silicon panels are ~25% efficient and are approaching their theoretical performance limit, though new designs aim to increase efficiency further.

Emerging solar materials which use very thin light-absorbing layers, could provide an alternative to silicon PV in some niche applications. These materials can be lighter, flexible or semi-transparent, and could be cheaper to manufacture. They are generally less efficient and have shorter lifetimes than silicon but have potential applications in building-integrated and indoor solar.

Tandem solar panels stack two materials together to capture a greater range of light and have demonstrated the highest efficiencies, above the theoretical maximum of current silicon panels.

Acknowledgements

This briefing was produced in consultation with experts and stakeholders, who are listed at the end of the briefing. POST would like to thank everyone who contributed their expertise to this briefing.