It is becoming a fairly common sight in Scotland (and indeed the UK as a whole) to see solar panels on private houses — most commonly attached to the roof. These panels will usually have been installed at a relatively low cost under one of a variety of Government-backed schemes. One such scheme is the "Feed-in Tarriff" scheme ("FiT")
In short, and very generally, energy companies who are FiT accredited can enter into contracts with people (invariably homeowners) to install solar panels at a reduced cost. The energy company will enter into a contract with the homeowner, which will provide that the homeowner will receive payments from the energy company dependent upon, amongst other things, the amount of electricity the homeowner's solar panels generate over and above that used to power the house's appliances. That 'spare' electricity is repurposed for the national grid.
Where a problem might arise is when it comes time for the homeowner to sell the house. What happens to the solar panels? Who stands to benefit from the ongoing FiT payments? Does the new owner need to enter into a new FiT contract with the energy company? Whilst these issues should all be dealt with by the solicitors dealing with the house sale/purchase, sometimes things can slip through the net.
Broadly, the solar panels would be included in the sale of the house, regardless of whether they are specifically mentioned in the contract. The panels would, very probably, be legally seen to have become part of the house under the law of accession. The contract for the sale/purchase might go even further, and say that anything that would materially damage the house were it to be removed is treated as being part of the house.
If, for some reason, that were not the case, then the seller could find him/herself facing a breach of contract claim. Most contracts will include a clause to the effect that the seller guarantees that he/she owns everything that is being sold to the purchaser. So, if the seller or an energy company wanted to remove 'their' panels after the sale, they would have a battle on their hands.
The other questions can be answered more pragmatically — the energy companies tend to include a clauses in their FiT contracts to the effect that (1) they will only pay the owner of a property with solar panels, and (2) that a new owner can apply to receive the FiT payments by taking over the FiT contract with the energy company.
Generally, a seller should assume that he/she will not be entitled to any FiT payments from the date of the sale. Equally, however, a purchaser should be careful to ensure that he/she fully understands the contract that he/she will require to become a party too once he/she is the owner of the property (and, by extension, the solar panels).
Nothing in this article should be taken as legal advice. Our expert residential property solicitors have experience of purchases and sales involving solar panels, and can guide you through the process. Equally, if you find yourself involved in a dispute with a seller/purchaser regarding solar panels, our litigation solicitors can give you expert advice.