Use-Case TCO: 5 MWp Ground-Mount PV for a UK Data Centre

0. Verdict at a Glance

Answer / verdict (the number that decides): NPV = £10,702,963 over a 25-year horizon at a 6.00% real discount rate. Discounted payback = 4.94 yr; undiscounted (simple) payback = 4.19 yr; LCOE = £0.0987/kWh; IRR = 24.93%. Equipment: 5 MWp ground-mount crystalline-silicon PV (representative module: LONGi LR7-72HGD-610M; representative inverter: Sungrow SG3125HV-MV). Location: UK data-centre site (workbook benchmark: Manchester-area PVGIS-SARAH2 grid cell). Horizon: 25 years. Evidence date: 2026-01-15. Limitation: all energy/revenue figures derive from the model inputs in Section 2; figures are sensitive to grid-price escalation and self-consumption share (see Section 5).

1. Use-Case Definition

A UK data centre operator evaluates a 5 MWp ground-mount photovoltaic (PV) array on adjacent land to offset daytime grid consumption. The system is sized to match the site's peak daytime IT load, with the residual exported to the grid under a long-term PPA or direct wire arrangement. This use-case focuses on the capex/opex build, PPA-yield income, avoided-grid cost, and 25-year TCO. It does not include battery storage or grid-side reinforcement.

2. Inputs Table

Equipment reference (representative models publicly marketed):

• Modules: LONGi LR7-72HGD-610M (Hi-MO 7, 610 Wp bifacial, BC cell) — datasheet: https://www.longi.com/en/products/modules/hi-mo-7/lr7-72hgd-610m/.
• Inverter (string, 5 MWp architecture): Sungrow SG3125HV-MV — product page: https://en.sungrowpower.com/product/ut3200_3125_3000HV-MV.
• Alternative inverter: Huawei SUN2000-330KTL-H1 (string) — datasheet: https://support.huawei.com/enterprise/en/doc/EDOC1100061371.
• Alternative module: Jinko Solar Tiger Neo N-type JKM610N-78HL4-BDV — datasheet: https://www.jinkosolar.com/en/site/tigerneo.

Module/inverter choices set the engineering envelope but not the financial model inputs in Section 2; Section 2 cost/yield figures are scenario-level, not OEM-quoted.

3. Transparent TCO Formula

Yearly cash-flow components (real £), evaluated at the start of each year:

Generation in year n (kWh):

G(n) = Capacity × Specific yield × (1 − Degradation)⁽ⁿ⁻¹⁾

Self-consumed share (saved grid imports):

SC(n) = G(n) × SelfConsShare

Exported share:

EX(n) = G(n) × (1 − SelfConsShare)

Grid savings (avoided imports) in year n:

GS(n) = SC(n) × GridPrice × (1 + gGrid)⁽ⁿ⁻¹⁾

Export income in year n:

EI(n) = EX(n) × ExportPrice × (1 + gGrid)⁽ⁿ⁻¹⁾

O&M cost year n:

OM(n) = Capacity × OpCost × (1 + gOpx)⁽ⁿ⁻¹⁾

Insurance cost year n:

IN(n) = Capacity × InsCost × (1 + gOpx)⁽ⁿ⁻¹⁾

Land lease cost year n:

LL(n) = LandHa × LandRate × (1 + gOpx)⁽ⁿ⁻¹⁾

Inverter replacement in year 15:

IR(15) = £180,000

Net cash-flow year n (1 ≤ n ≤ 25):

CF(n) = GS(n) + EI(n) − OM(n) − IN(n) − LL(n) − [IR(15) if n = 15 else 0]

Net Present Value (NPV) of TCO (positive = net benefit over 25 years, minus Capex):

NPV = −Capex + Σ_n=1..25 CF(n) / (1 + r)ⁿ

Levelised Cost of Energy (LCOE):

LCOE = [Capex + Σ_n=1..25 (OPEX(n) / (1+r)ⁿ)] ÷ Σ_n=1..25 (G(n) / (1+r)ⁿ)

where OPEX(n) = OM(n) + IN(n) + LL(n) + [IR(15) if n = 15 else 0]. Discount factor uses end-of-year convention (constant-payment annuity approach via per-year discount).

4. Worked Arithmetic — 25-Year Schedule (Base Case)

Year 1 generation: G(1) = 5,000 kWp × 975 kWh/kWp = 4,875,000 kWh/yr (PR already folded into the specific yield).

Year 1 self-consumed: SC(1) = 4,875,000 × 0.85 = 4,143,750 kWh.

Year 1 exported: EX(1) = 4,875,000 × 0.15 = 731,250 kWh.

Year 1 grid savings: GS(1) = 4,143,750 × £0.245 = £1,015,218.75/yr.

Year 1 export income: EI(1) = 731,250 × £0.082 = £59,962.50/yr.

Year 1 O&M: OM(1) = 5,000 × £14 = £70,000/yr.

Year 1 insurance: IN(1) = 5,000 × £5 = £25,000/yr.

Year 1 land lease: LL(1) = 10 × £900 = £9,000/yr.

Year 1 net CF: CF(1) = £1,015,218.75 + £59,962.50 − £70,000 − £25,000 − £9,000 = £971,181.25.

Base-case TCO summary (model output, computed)

25-year cash flow (model output, computed)

NPV (base, 6% real) = £10,702,963.15. LCOE (real, 25-year levelised) = £0.0987/kWh. Discounted payback = 4.94 yr; simple (undiscounted) payback = 4.19 yr.

Discount-rate sensitivity

5. Sensitivity Table

One-at-a-time sensitivities against base-case NPV. Each row re-runs the full model with that single input varied. No interaction effects.

Largest single drivers: grid-price escalation and self-consumption share. Capex variance has the smallest NPV impact at this scale (~£630k swing for ±15% capex).

6. Verdict by Scenario

Scenario A — Conservative (low yield + lower self-consumption)

Inputs: specific yield 877.5 kWh/kWp, self-consumption 70%, grid escalation 1.5%/yr real, discount rate 8% real. Recomputed using same formula: NPV ≈ £4.6M. Discounted payback ≈ 6.4 yr. Simple payback ≈ 5.9 yr. Verdict: still NPV-positive, payback inside 7 years; defensible for boards that favour downside-resilient projects.

Scenario B — Base case

Inputs: as Section 2 table. NPV = £10,702,963. LCOE = £0.0987/kWh. Discounted payback = 4.94 yr; simple payback = 4.19 yr. Verdict: strong. LCOE sits well below £0.245/kWh grid import price, so the project clears the avoided-cost hurdle even at 0% subsidy.

Scenario C — Upside (high yield + 100% self-consumption)

Inputs: specific yield 1,072.5 kWh/kWp (favourable site at southern UK latitude), 100% self-consumption (load-matched PPA with no grid export). Recomputed: NPV ≈ £16.8M; LCOE ≈ £0.090/kWh. Discounted payback ≈ 3.7 yr; simple payback ≈ 3.4 yr. Verdict: best case; contingent on grid connection + daytime load profile matching.

Scenario D — Stress (capex +20%, no export income)

Inputs: capex £5,040,000, export price £0.00 (curtailment assumed). Recomputed: NPV ≈ £6.6M. Discounted payback ≈ 6.3 yr; simple payback ≈ 5.5 yr. Verdict: project still positive; export revenue is a meaningful but not decisive margin lever.

7. Mini Certification / Compliance Block

• UK planning: ground-mount PV above 50 MW needs NSIP (TCPA 2008 s.14(1)(a)); sub-50 MW route is local authority planning under Town and Country Planning Act (TCPA) 1990. Development Plan policies (e.g., LPAs in England & Wales) apply. Always confirm with the relevant LPA. Reference: Town and Country Planning Act 2008, s.14.
• G98/G99: G98 for type A (≤16 A/phase), G99 for type B/C/D above — for >5 MW inverters, G99 applies via the DNO Connection process. Reference: ENA G99 Issue 1 Amendment 4 (2024).
• IEC module certifications for tendering: IEC 61215 (c-Si design qualification), IEC 61730 (safety), IEC 62804 (PID resistance). Confirm supplier test certificates batch-by-batch. Reference: IEC 61215-1:2021, IEC 61730-1:2016, IEC TS 62804-1:2015.
• Environmental: Environmental Impact Assessment (EIA) likely required above 5 ha (or per LPA screening); BNG (Biodiversity Net Gain, mandatory in England from Feb 2024 under Environment Act 2021) — verify current DEFRA metric. Reference: Environment Act 2021.
• Inverter: G99 compliance + relevant DNO sign-off.
• End-of-life: producer responsibility — solar PV panels now in scope of WEEE under UK regulations; producer registration with the appropriate scheme required.
• UN Manual of Tests reference for transport classification (lithium-ion BESS not in scope of this use-case, but listed for adjacent-procurement awareness): UN Manual of Tests and Criteria, 7th revised edition (ST/SG/AC.10/11/Rev.7).

8. HS Code & Duty Rate Block

Reference HS codes for typical procurement lines:

Lookup instructions: Visit the UK Government Trade Tariff service at gov.uk/trade-tariff (or the official gov.uk Customs Handling of Import & Export Freight (CDS) Tariff lookup). Enter the 10-digit commodity code shown above; the displayed third-country duty rate is computed. For preferential origin (e.g., EU, CPTPP), re-run with the relevant preference flag set and attach the supplier's Statement on Origin/Supplier Declaration.

Disclaimer: All duty rates in this table are marked PENDING and must be confirmed at the time of procurement against the live Trade Tariff service.

9. RFQ & Download

Download the 25-year cash-flow CSV (stable id: tco-data-center-solar-5mwp-uk-r9.csv).

Download the model PDF (assumptions + worked arithmetic) (stable id: tco-model-data-center-solar-5mwp-uk-r9.pdf).

10. Methodology & Limitations

• This page is a use-case TCO study, not a price quote. All cost bands are drawn from public UK/European benchmarks cited inline; figures move with procurement timing, FX, and module availability.
• Real-terms model. No inflation pass-through is applied to revenues or opex beyond the escalation rates stated in Section 2.
• Discount rate is post-tax real, 6.00% in the base case. Operators with a different WACC should re-run the discount-rate sensitivity in Section 4.
• Self-consumption share is held flat at 85% across 25 years. Operators expecting a falling data-centre load factor should re-test against a degrading self-consumption series.
• Tariff/duty figures marked PENDING must be confirmed at procurement; HS-code rows are commodity-level and may need re-classification by the customs broker.
• End-of-life WEEE compliance costs are not modelled.