The finance behind Oaklands Farm Solar Park — and where the public really does pick up the bill
By Shane Oxer | 23 September 2026
When people are told that solar power is “cheap”, they are shown the panels and reminded that sunshine is free. They are rarely shown the balance sheet behind the project, the borrowed money, the accumulating interest or the additional network costs needed to carry intermittent electricity to market.
The latest accounts for Oaklands Farm Solar Limited, filed at Companies House on 18 September 2026, provide a rare look behind the sales pitch.
Oaklands Farm Solar Limited is a special-purpose company created for one project. That structure is common and is not, by itself, improper. But it matters because the project’s costs, debts and risks are concentrated inside a company with one ordinary share worth just £1.
At 31 December 2025, the position was:
Filed figure| Amount
Loan from BayWa r.e. UK Limited| £4.401 million
Interest rate on that loan| 7.8%
Interest charged during 2025| £280,000
Interest charged during 2024| £199,000
Assets under construction| £3.743 million
Cash| £1,000
Net liabilities/shareholders’ deficit| £633,000
Paid-up share capital| £1
Employees| None
The £1 share does not mean BayWa has risked only £1. Its economic support has been provided mainly as debt rather than share capital. But that is precisely the point: before Oaklands has generated or sold a single unit of electricity, borrowing and interest are already central to the project.
The debt clock is already running
The parent-company loan increased from £3.660 million at the end of 2024 to £4.401 million at the end of 2025 — an increase of £741,000 in one year.
Oaklands incurred £280,000 of interest during 2025, up from £199,000 in 2024. That is £479,000 of interest in the last two reported years alone.
At the year-end loan balance, 7.8% is equivalent to approximately:
– £343,000 a year;
– £28,600 a month; or
– £940 every day.
The actual 2025 charge was lower because the full £4.401 million was not necessarily outstanding for the entire year. Nevertheless, the direction is unmistakable: the longer the development period continues and the more money the company draws, the larger the financing burden becomes.
The loan is repayable on demand and the facility is available only until December 2027. The accounts also contain a material uncertainty over the company’s ability to continue as a going concern. Oaklands depends on BayWa r.e. AG continuing to support it, while BayWa itself is undergoing restructuring. The directors also disclose that discussions to sell the company are at an advanced stage and that they do not know what a buyer’s plans would be.
The £4.4 million is only the development-stage borrowing
Oaklands is a proposed 152.4 MW solar project, with up to 37.5 MW of battery storage. Its current borrowing does not represent the full construction cost.
The Department for Energy Security and Net Zero commissioned Arup to examine the cost of large-scale British solar. Its central benchmark is £659 per kilowatt of capacity, comprising approximately £24/kW for pre-development, £522/kW for construction and £112/kW for infrastructure.
Applied to Oaklands’ 152.4 MW solar capacity, that produces the following indicative breakdown:
Official benchmark applied to Oaklands| Approximate cost
Pre-development| £3.7 million
Main construction| £79.6 million
Infrastructure| £17.1 million
Central total| £100.4 million
The same official evidence gives a low-to-high capital-cost range of roughly £80.2 million to £120.1 million for a project of this size, in 2023 prices. Actual 2026–28 cash costs could differ because of inflation, procurement, site conditions and the final grid design.
There is a striking comparison here. Oaklands already reports £3.743 million of assets under construction — almost exactly the £3.7 million central pre-development benchmark. That strongly suggests the filed accounts show a project that has largely accumulated its development costs but has not yet financed the main build.
The battery is another potential cost. Current industry evidence puts a two-hour British battery project at just over £500,000 per MW. If Oaklands constructed the full 37.5 MW as a two-hour battery, that would indicate roughly another £19 million. The project has not published its final battery duration or financing, so that figure must remain illustrative and is not included in the £100.4 million solar estimate.
What could the eventual borrowing and interest look like?
Oaklands has not published its construction-finance package. We therefore cannot state how much a buyer will borrow, what rate it will pay or how quickly the debt will be repaid.
But we can show the scale using a transparent illustration: 70% debt, 30% equity, the company’s presently disclosed 7.8% interest rate and level annual repayments over 20 years.
Solar cost case| 70% borrowing| Interest on full debt for one year| Annual debt payment over 20 years| Total interest over 20 years
Low: £80.2m| £56.1m| £4.4m| £5.6m| £56.5m
Central: £100.4m| £70.3m| £5.5m| £7.1m| £70.8m
High: £120.1m| £84.1m| £6.6m| £8.4m| £84.6m
These are not disclosed Oaklands loans or forecasts. They are a worked example showing why the cost of capital matters. Under the central illustration, approximately £70 million would be borrowed and approximately another £71 million would be paid in interest over 20 years, as well as repaying the principal.
Oaklands’ own accounting policy makes another important point. During development, interest is charged as a loss. Once construction begins, directly attributable financing costs are added to the value of the asset under construction.
Capitalising interest does not make it disappear. It folds that interest into the project cost that future revenues must recover.
With BayWa forecasting a 20-to-24-month build, even a gradually drawn £70 million construction loan could accumulate several million pounds of interest before the solar farm becomes operational. A connection delay after the debt has been drawn would make that exposure considerably worse.
Does the public pay all of this?
Not automatically — and this distinction is important.
Oaklands’ £4.401 million parent loan is private company debt. Households do not receive a separate bill demanding repayment of it. If the project fails, private shareholders, lenders and suppliers bear the first loss.
Nor does Oaklands presently have a Contract for Difference. Ofgem upheld its AR7a non-qualification in December 2025.
If Oaklands connects and trades without a Contract for Difference, it must earn money through a power-purchase agreement, wholesale-market sales and potentially battery services. Its financing costs influence the price and return its owner requires, but the market does not guarantee that every pound will be recovered.
However, the public can still pay through several routes.
First, electricity purchasers ultimately fund the project’s operating costs, debt service and investor return through the price paid for its output. Those costs move through suppliers and into customer bills, although they are subject to market risk rather than an automatic cost-plus guarantee.
Second, a future Contract for Difference or another support mechanism could transfer more price risk to consumers. Oaklands does not currently have such a contract, but any later award would need to be assessed at that time.
Third, the project should pay for its dedicated connection assets. But wider transmission reinforcement and maintenance are recovered through Transmission Network Use of System charges paid by generators and suppliers. The supplier share ultimately forms part of bills.
The regulated grid companies also receive an allowed return on the capital invested, meaning consumers fund not only the steel and substations but the financing of the network programme as well.
Fourth, the National Energy System Operator recovers day-to-day balancing costs through Balancing Services Use of System charges. Since April 2023, those charges have been recovered solely from final demand. That means households and businesses ultimately fund the cost of balancing the system, including the consequences of having generation in the wrong place or at the wrong time.
This creates two distinct financing layers: the cost of financing the generating project, recovered through electricity revenues, and the cost of financing and operating the wider network, recovered through regulated system charges.
The public debate usually quotes only the project’s nominal generating capacity and ignores the second layer.
It would still be wrong to assign the proposed October 2029 Drakelow supergrid transformer entirely to Oaklands. The public evidence shows Oaklands as a direct National Grid Electricity Transmission connection, while the October 2029 transformer appears in the Appendix G programme for embedded distribution-connected generation.
Unless Oaklands’ confidential connection agreement says otherwise, that transformer cannot simply be labelled an Oaklands cost.
Sunshine is free. The system built around it is not.
Oaklands Farm Solar Park may yet be constructed, connected and operated successfully. But its own accounts expose a reality missing from political slogans.
Before producing electricity, the project company had already borrowed £4.401 million and incurred £479,000 of interest in two years.
The main solar build could cost about £100 million, with a plausible official range of £80 million to £120 million before any battery. Depending on the eventual finance structure, interest and investor returns could add tens of millions more over the project’s life.
Then come the network, balancing, constraint, backup and regulated financing costs that are not captured by pointing at a solar panel and saying the fuel is free.
The honest question is not whether sunshine has a fuel cost. It does not.
The honest question is the total cost of delivering dependable electricity to consumers after borrowing, interest, connection, reinforcement, balancing and system security have all been included.
That is the figure the public deserves to see.
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Sources
– “Oaklands Farm Solar Limited — Companies House” (https://find-and-update.company-information.service.gov.uk/company/12915335/filing-history) — full accounts for the year ended 31 December 2025, filed 18 September 2026.
– “DESNZ/Arup: Onshore wind and solar cost and technical assumptions” (https://www.gov.uk/government/publications/onshore-wind-and-solar-cost-and-technical-assumptions).
– “BayWa r.e.: Oaklands Farm Solar Park” (https://www.baywa-re.co.uk/en/projects/solar/oaklands-farm-solar-park).
– “NESO: AR7 and AR7a Appeals Register” (https://www.neso.energy/document/376946/download).
– “NESO: Connection charges” (https://www.neso.energy/industry-information/charging/connection-charges), “TNUoS charges” (https://www.neso.energy/industry-information/charging/tnuos-charges) and “BSUoS charges” (https://www.neso.energy/charging/balancing-services-use-system-bsuos-charges).
– “Ofgem: Energy network price controls” (https://www.ofgem.gov.uk/energy-regulation/how-we-regulate/energy-network-price-controls).
– “Reuters: UK battery construction costs” (https://www.reuters.com/business/energy/europes-renewables-market-powers-battery-storage-boom-2025-02-06/).
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