Shield C&I Sites from Energy Price Disruption with Solar

Hello, Champions of Net Zero!

As we navigate the path towards a sustainable future, the importance of innovative solutions in the energy sector cannot be overstated. One such solution that is gaining traction among UK energy managers is near-site solar power. This approach not only facilitates the decarbonisation of operations but also provides a shield against the unpredictable fluctuations of grid energy prices.

In recent years, the landscape for energy managers in the UK has been turbulent. The commercial and industrial (C&I) energy market has faced a barrage of challenges, particularly since the energy crisis of 2022. This unprecedented situation saw energy prices soar, with natural gas costs leading to a near 80% increase in the energy price cap. It was only through decisive government intervention that consumers were spared from the full brunt of these rising costs.

The factors contributing to this volatility are numerous and complex, often beyond the control of individual energy managers. The geopolitical turmoil stemming from the Russian invasion of Ukraine sent shockwaves through natural gas and power markets across Europe. Compounding this issue was an underperforming French nuclear fleet, which typically supplies a portion of the UK’s energy through interconnectors. When this supply became economically unfeasible, the impact was felt in the form of sustained high wholesale energy prices—costs that were ultimately borne by governments, businesses, and consumers alike.

As we look ahead to 2025, the task of insulating individual sites from pricing volatility remains a formidable challenge for energy managers. However, there exists a beacon of hope in the form of funded decarbonisation solutions that can act as a hedge against energy price fluctuations.

The UK is steadfast in its ambition to become a self-sufficient “clean energy superpower”, and progress is being made. The penetration of renewable energy sources is increasing at an encouraging pace. Notably, on April 1st, 2025, Great Britain set a new record for maximum solar generation, a testament to the nation’s commitment to renewable energy.

To align with the government’s Clean Power 2030 objectives, it is essential that the UK’s power system generates “clean” energy sources that can meet or exceed national consumption levels over the course of a year, with at least 95% of this power produced domestically. Achieving this ambitious target will require wind and solar energy to encompass approximately 80% of the country’s energy mix within the next five years. Therefore, substantial investment in renewable innovation, research, manufacturing, and infrastructure is crucial.

Encouragingly, the current government has taken significant steps to reduce barriers to renewable project development. The previous moratorium on new onshore wind projects has been lifted, and recent changes in planning regulations now empower local authorities to make decisions on smaller projects. This streamlining of processes has the potential to reduce both costs and administrative burdens. Yet, more must be done to unlock further investments. Currently, there is nearly twice as much solar energy capacity in the planning stages (27 GW) compared to the total capacity ever installed in the UK (15.5 GW).

While larger renewable projects contribute power to the grid, the benefits often materialise indirectly. Data centres and industries across the UK must pivot towards direct contracting strategies to secure tangible benefits. The increasing viability of locally generated solar power offers a pathway for large energy users to realise significant annual energy cost savings while safeguarding against future price disruptions. The two most effective technical solutions to underpin this hedge are onsite and nearby offsite renewable installations.

The most straightforward onsite solution is the installation of rooftop solar panels. Rooftop solar is emerging as a significant growth driver for the UK’s solar capacity. Currently, around 1.6 million rooftops are equipped with solar technology, including over 200,000 non-residential buildings. The UK’s extensive warehousing stock possesses ample unused roof space capable of accommodating an additional 15GW of solar infrastructure, effectively doubling the country’s solar photovoltaic (PV) capacity as of 2023. Developing PV solar on just the largest 20% of the UK’s warehouses could provide an impressive 75 million square metres of roof space, thereby eliminating the need to develop new land equivalent to the footprint of approximately half a million homes.

However, for larger facilities—such as hyperscale data centres or intricate industrial sites—rooftop solar often falls short due to spatial limitations. These substantial power users require megawatts and gigawatts of energy, not merely kilowatts. To overcome these constraints, projects are frequently developed offsite. By connecting one or more dedicated generation assets via a private wire to a large energy consumer’s site, it is possible to provide the necessary energy supply at scale.

From a development and delivery perspective, private wire projects offer a swifter alternative to grid-connected renewables. By bypassing grid connection queues and the costly reinforcement works often required, these projects enable most of the generated energy to be consumed onsite, with minimal surplus spilling into the grid. Planning for such initiatives is typically well-received, as the dedicated renewable asset is geared towards decarbonising a significant regional employer.

As we move further into the decade, the UK’s power grid is likely to experience increased strain, posing potential challenges for large energy users who may encounter painful power constraints unless urgent upgrades are implemented. From a business perspective, it is essential that power sourced from the grid supports all energy users in their decarbonisation efforts. Unfortunately, initiatives aimed at electrifying heating and transport are often stalled due to the necessity of grid upgrades. These delays can lead customers to seek alternative solutions, such as onsite or near-site energy generation. The rise of new, power-hungry sectors, including hydrogen electrolysis and AI data centres, further complicates the landscape by introducing additional, uncertain grid upgrade requirements.

For large energy users, the business case for renewables is clear: it hinges on cost certainty and savings. Long-term renewable energy supply agreements can be as much as 30% cheaper than traditional grid electricity, as private wire projects are exempt from non-commodity costs. These cost advantages provide a significant competitive edge, enabling eligible sites to outperform their rivals.

Despite the allure of renewable projects, the complexities involved can often serve as a distraction for energy managers who juggle multiple priorities. Fortunately, turnkey and funded solutions are available. Capex-free solutions not only alleviate financial burdens but also allow large energy consumers to allocate limited capital towards core business growth initiatives. Price certainty can be achieved through diverse pricing and product structures. In scenarios where renewable assets are not generating energy due to unfavourable weather conditions, the ability to import from the grid remains intact, providing a layer of resilience and security.

The UK is on course for a clean energy future, but achieving this vision will necessitate a steep increase in renewable energy adoption. In the interim, energy managers must not find themselves at the mercy of the grid. Investing time to explore near-site renewable options is a crucial step that commercial and industrial energy managers cannot afford to overlook.

In conclusion, as the UK strives to meet its ambitious climate goals and transition towards a greener economy, the role of energy managers has never been more critical. By embracing innovative solutions like near-site solar power, they can not only contribute to the decarbonisation of their operations but also enhance their resilience in the face of an ever-changing energy landscape. The journey towards a sustainable future is fraught with challenges, but with the right tools and strategies, we can all play a part in shaping a cleaner, greener world.

This article first appeared in the May 2025 issue of Energy Manager magazine. Subscribe here for more insights and updates.