Solar and carbon reporting: what rooftop solar does to your emissions figures

The short answer

Electricity you buy from the grid is reported as Scope 2 emissions. When you generate electricity on site with your own solar panels and use it yourself, you buy less from the grid, so your reported Scope 2 emissions fall. Unlike buying a green tariff, this reduces your emissions under both the location-based and market-based reporting methods, because the electricity is never bought at all.

Solar can then appear in the reports that ask about emissions: Streamlined Energy and Carbon Reporting (SECR) for large companies, carbon reduction plans for major government contracts, and the supplier questionnaires that large customers now send out. You need good meter data to evidence it, and care over what you claim, especially for exported electricity and systems owned by a third party.

This guide is general information, not reporting advice. Rules and guidance change, so confirm your approach with whoever prepares your emissions figures.

The three scopes in brief

How rooftop solar affects Scope 2

You own the system and use the electricity

This is the simplest case. Every kWh the panels produce and the building uses is a kWh you did not buy from the grid. Your Scope 2 figure falls in proportion. If your annual consumption is 300,000 kWh and solar supplies 72,000 kWh of it, your purchased electricity is 228,000 kWh and that is what you report. Our guide on how much solar your business needs shows how those figures are estimated.

Exported electricity

Electricity you export is used by someone else on the grid. Under common reporting practice you do not subtract it from your Scope 2 emissions, because emissions inventories record what you caused, not what you might have avoided elsewhere. Some organisations report exported renewable generation separately as additional information. Do not net it off.

A third party owns the system

Under an on-site power purchase agreement, a provider owns the panels and sells you the electricity. You are still buying electricity, so it sits in Scope 2. How it is reported, and whether it can be treated as zero emission under the market-based method, depends on the contract and on who keeps the renewable attributes. Check the agreement and ask your carbon adviser.

Check which version of the GHG Protocol Scope 2 guidance your reporting framework uses, and how it treats on-site generation, PPAs and certificates, with your carbon adviser.

An illustrative example

Take the illustrative site used in our sizing guide: a manufacturer using 300,000 kWh of electricity a year installs a 100 kWp system that generates about 90,000 kWh, of which 72,000 kWh is used on site and 18,000 kWh exported.

• Before solar: purchased electricity is 300,000 kWh.
• After solar: purchased electricity is 228,000 kWh, a fall of about 24%.
• Reported Scope 2 (location-based): 228,000 kWh multiplied by the grid conversion factor for the reporting year.
• Exported 18,000 kWh: not deducted. It can be noted separately if you wish.

The percentage fall in purchased electricity carries straight through to location-based Scope 2, whatever the grid factor is in a given year. The market-based figure falls by the same share of purchased electricity, multiplied by whatever factor applies to your supply contract. These are illustrative figures only; your own meter data provides the real ones.

Baselines and targets

If you have a baseline year and a reduction target, the solar installation shows up as a step change in the year it is commissioned. Two points help keep the record clear:

• Note the commissioning date in your reporting so that a part-year of generation is not mistaken for underperformance.
• Remember that the grid conversion factor changes every year as the UK grid changes. Your location-based emissions can move even if your consumption does not, so report kWh purchased alongside tonnes of CO2e. The kWh figure shows the effect of solar most clearly.

Location-based and market-based reporting

The two methods answer different questions.

The UK government publishes greenhouse gas conversion factors for company reporting each year, and many UK organisations use them for location-based figures. Many reporters show both methods, which is known as dual reporting.

The practical point for decision makers is that on-site solar is a reduction that holds up under either method and is hard to challenge, because it reduces the electricity you buy.

SECR for large companies

Streamlined Energy and Carbon Reporting requires certain companies and LLPs to include energy and carbon information in their annual reports. In general terms it applies to:

• quoted companies
• large unquoted companies and LLPs that meet the size tests for employees, turnover and balance sheet

Large unquoted companies and LLPs that used 40,000 kWh of energy or less in the UK in the reporting period are exempt as low energy users.

Reports typically include UK energy use, the associated emissions, at least one intensity ratio, the methodology used and a description of energy efficiency action taken during the year. A rooftop solar installation can be described as part of that action, and its effect shows up in lower purchased electricity in the following years.

The government's environmental reporting guidelines, including SECR requirements are the main reference.

"Large" uses the Companies Act test: two or more of turnover, balance sheet total and employees above the medium-sized limits. For accounting periods starting on or after 6 April 2025 those limits are £54 million turnover, £27 million balance sheet total and 250 employees (GOV.UK). Check with your accountant which applies to your year.

Carbon reduction plans for public sector contracts

Suppliers bidding for major central government contracts in England may be asked for a carbon reduction plan. Under PPN 006, which applies to procurements under the Procurement Act 2023, in-scope organisations (central government departments, their executive agencies and non-departmental public bodies) are expected to require one for contracts with an estimated value above £5 million a year.

In general terms, the plan must confirm the supplier's commitment to net zero by 2050 in the UK, report Scope 1 and Scope 2 emissions and a defined subset of Scope 3, and set out environmental management measures. On-site solar is a measure you can describe in the plan, and its effect appears directly in your Scope 2 figures. Procurements that started under the previous regime may still refer to the earlier note, PPN 06/21. Wales has its own note, and other parts of the public sector set their own requirements.

Our guide to carbon reduction plans sets out what a plan must contain, from GOV.UK's guidance read on 2 November 2026.

Supplier questionnaires and customer net zero requirements

Your emissions are part of your customers' Scope 3. Large companies with net zero targets increasingly ask suppliers for:

• Scope 1 and Scope 2 emissions, often with the method stated
• targets and progress towards them
• evidence of reduction actions, such as on-site renewables
• renewable electricity as a share of total use

These requests are common in food and drink supply chains, manufacturing and logistics, and can affect whether you stay on an approved supplier list. A rooftop system gives you a concrete, measurable answer. See our pages on food and drink and factories for the sector context.

REGOs in general terms

Renewable Energy Guarantees of Origin are certificates issued by Ofgem, one per MWh of eligible renewable output, to show that electricity came from renewable sources. Their main use is fuel mix disclosure by electricity suppliers. When you buy a renewable tariff, the supplier is usually matching your consumption with REGOs, which is what lets you report lower market-based emissions.

For on-site solar, the key points are:

• REGOs are not needed to report the reduction from electricity you generate and use yourself, because you simply buy less.
• Where REGOs are issued for generation, whoever holds or sells them holds the renewable claim. If you sell them, you should not also claim that electricity as renewable.
• Under a PPA, the contract should state who keeps any certificates.

Ofgem's REGO scheme page explains how accreditation works.

Measuring and evidencing solar generation

Good reporting needs good data. Make sure your system has:

• a generation meter recording total output from the array
• an export meter, usually your import and export meter at the supply point
• import data from your supplier, ideally half-hourly

Self-consumption is total generation minus export. Keep monthly records, download data from your monitoring platform regularly and keep it with your reporting evidence. Our page on energy data analysis explains how half-hourly data is used. Adding battery storage changes the arithmetic, because some solar is stored before use, so make sure the metering can tell the flows apart.

What to avoid claiming

• "Carbon neutral because of our solar." Solar reduces Scope 2 emissions. It does not usually remove all of them, and it does not touch Scope 1 or Scope 3.
• Subtracting exports. Do not net exported generation off your emissions.
• Double counting. If you sell certificates or a third party owns the attributes, do not also claim the renewable benefit.
• Vague green claims to customers. The Competition and Markets Authority's Green Claims Code sets out how environmental claims should be truthful, clear and substantiated.

Where solar fits in a carbon plan

For most organisations a sensible sequence is: understand your consumption, cut waste through efficiency, generate on site with solar, then use storage and smart controls to make the most of it, and electrify heat and vehicles over time. Solar is often the most visible step and one of the easiest to measure. If you want to know how much difference it could make on your site, request a free survey and ask for the generation and self-consumption estimate to be set out in kWh, so it can feed straight into your reporting.