Why Solar Panel Prices Are Starting to Climb Again

Solar panel prices in the UK are heading up after roughly two years of falling, and the trigger happened in Beijing, not London. China’s Ministry of Finance scrapped the VAT export rebate on photovoltaic products from 1 April 2026, and because around 80% of the world’s panels are made there, including most of what ends up on UK roofs under European or British brand names, that change is working its way into UK quotes.

What actually changed

Until April, Chinese manufacturers got part of the VAT refunded on solar products they exported: wafers, cells, modules and related materials like conductive glass. Removing that rebate raises the cost of getting a panel out of a Chinese factory and onto a container ship, and manufacturers running on thin margins after years of price wars aren’t in a position to absorb that themselves for long.

Industry forecasts put the eventual UK retail impact at 8% to 15% by the end of 2026. It isn’t arriving as one sharp jump, though. Mainstream panel prices actually dipped around 3.6% between April and July, so the rebate removal seems to be working through the supply chain in stages rather than hitting UK shelves overnight.

What it means for your quote

Steadily falling panel prices since 2024 are a big part of why installed system costs have stayed roughly flat even as labour, inverters and other components have crept up elsewhere. As of June 2026, a typical 4kW to 10kW system still worked out to around £1,785 per kilowatt, putting a 4kW installed system at roughly £5,500 to £7,500. If the panel component of that quote starts climbing instead of falling, the run of solar getting a little cheaper every year is over for now, even if your total installed price doesn’t move much straight away.

The VAT saving isn’t going anywhere

It’s worth keeping this separate from a different piece of news that actually helps. The 0% VAT rate on installed solar, battery and other energy-saving equipment runs until 31 March 2027, and that has nothing to do with what panel manufacturers charge. It applies to the installation cost on your quote, whatever the underlying hardware price is doing. Even if panels do get 8% to 15% more expensive by December, you aren’t losing the VAT saving by waiting. The two are moving on entirely different clocks.

Is it worth rushing a decision?

Rushing makes little sense on this alone. Nobody, including the manufacturers, has settled on exactly where prices land, and a system you buy today is priced against today’s stock, not next quarter’s forecast. What this does mean is that if you’ve been holding off on getting quotes because you assumed panels would keep getting cheaper indefinitely, that assumption no longer holds up. Get matched with vetted installers to see what your roof costs at today’s prices, and check whether solar is worth it for your home before deciding either way.

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