By the PPA Funding team Last updated
This glossary explains the commercial-solar and PPA terms a UK business owner meets most often, grouped into funding, technical and measurement terms. It covers PPA, hire purchase, kWp, kWh, DNO, G99, inverter, self-consumption, export and MCS, so you can read a proposal or contract without stopping at the jargon.
Funding terms
PPA (Power Purchase Agreement): a contract where a funder owns the solar system and you buy the electricity it generates at a fixed rate per kWh, guaranteed at least 30% below the grid price, with no upfront cost. At the end of the roughly 20-year term the system becomes yours for £1.
Hire purchase: you pay in instalments and own the system once payments finish. Leasing: you pay to use the equipment over a set term. CapEx: you buy the system upfront and own it from day one. Each route has different cash-flow and accounting effects, so take advice.
Introducer: a business like us that connects you to funders and installers without being the funder or the installer. Our service is free, and we may earn commission from a partner.
Technical terms
DNO (Distribution Network Operator): the company that runs the local electricity network your site connects to. G99: the engineering rule set for connecting a generator above a certain size to the grid, which usually needs DNO approval before switch-on.
Inverter: the unit that converts the direct current from the panels into the alternating current your building uses. MCS (Microgeneration Certification Scheme): a quality standard for smaller installations and their installers.
Self-consumption: the share of your solar generation you use on site rather than exporting. Export: electricity you send to the grid because you are not using it at that moment.
Measurement terms
kWp (kilowatt-peak): the rated output of the system under standard test conditions, used to describe its size. kWh (kilowatt-hour): a unit of energy, and what you are billed for. A 1 kW load running for one hour uses 1 kWh.
MWh (megawatt-hour): one thousand kWh, often used for larger sites and for REGO certificates. Load: the amount of power your site draws at a given moment.
Half-hourly data: the record of your consumption in 30-minute blocks, which a good proposal uses to match system size to how and when you actually use power.
Quick glossary
- PPA (Power Purchase Agreement)
- A contract where a funder owns the solar system and you buy the electricity it generates at a fixed rate per kWh, guaranteed at least 30% below the grid, with no upfront cost. The system becomes yours for £1 at the end of the roughly 20-year term.
- Hire purchase
- You pay for the system in instalments and own it once the payments finish.
- Leasing
- You pay to use the equipment over a set term rather than buying it.
- CapEx (outright purchase)
- You buy the system upfront and own it from day one, keeping all the savings.
- Introducer
- A business like PPA Funding that connects you to funders and installers without being the funder or the installer. The service is free; we may earn a commission from a partner.
- DNO (Distribution Network Operator)
- The company that runs the local electricity network your site connects to.
- G99
- The engineering rules for connecting a larger generator to the grid, which usually need DNO approval before switch-on.
- Inverter
- The unit that converts the direct current (DC) from the panels into the alternating current (AC) your building uses.
- MCS (Microgeneration Certification Scheme)
- A quality standard for smaller installations and their installers.
- Self-consumption
- The share of your solar generation you use on site rather than exporting to the grid — where the biggest saving sits.
- Export
- Electricity you send back to the grid because you are not using it at that moment.
- kWp (kilowatt-peak)
- The rated output of a solar system under standard test conditions — used to describe its size.
- kWh (kilowatt-hour)
- A unit of energy, and what you are billed for. A 1 kW load running for one hour uses 1 kWh.
- MWh (megawatt-hour)
- One thousand kWh, often used for larger sites and for REGO certificates.
- Half-hourly data
- Your electricity consumption recorded in 30-minute blocks, used to match a system size to how and when you actually use power.
This guide is general information, not financial or tax advice. Your circumstances determine what applies — please confirm with your accountant or advisor. Get a tailored proposal →
Frequently asked questions
What is the difference between kW and kWh?
kW measures power, the rate at which electricity is used or generated at a moment. kWh measures energy, the amount used over time. A 5 kW system running for two hours produces about 10 kWh. Your bill is in kWh.
Do I need to understand G99 to get solar?
Not in detail. G99 is the grid-connection rule your installer and the DNO handle for larger systems. What matters to you is that approval can take time, so it is worth starting the process early. A good installer manages the paperwork.
Related guides
- Solar battery round-trip efficiency: the energy lost when you store and return electricity
- Solar panel embodied carbon and energy payback: the whole-life sustainability case
- What is a private wire energy supply? Direct power from an on-site or adjacent generator
See our funding options, commercial solar and solar by industry pages.