# Funding a commercial energy upgrade > How the funding route decides who owns the equipment, why that matters at lease end, and the questions to ask before signing anything. Source: https://commercialepcupgrades.co.uk/guides/funding-a-commercial-energy-upgrade --- # Funding a commercial energy upgrade Most discussion of funding is about cash flow. The part that matters longer is ownership. Buy the fittings and they are yours. Fund them through certain arrangements and they belong to somebody else for a period, which is a question that resurfaces at lease end, at a sale, and in any conversation with a lender. ## Why ownership is the real question An improvement that the landlord owns is part of the building, improves the asset and stays when the tenant leaves. An improvement owned by a finance provider, or installed and retained by a tenant, may not be. That matters in three places. At lease end, where reinstatement obligations and fixtures law decide whether equipment stays or goes. At sale, where a buyer’s solicitor asks what is encumbered. And at the next EPC assessment, where a building stripped of the plant that earned its rating is a building with a worse rating. ## The routes, and what each one does to ownership - Buy outright from cash or a general facility. Simplest, you own it, no third-party interest in the equipment. - Asset finance or lease purchase. You end up owning it, with a security interest over it until the term completes. - Operating lease or a service arrangement where a provider installs, owns and maintains the equipment and charges a periodic fee. Attractive on cash flow, and the equipment is not yours during the term. - Tenant-funded under an incentive or a fit-out contribution, where who owns it is determined by the lease and by whether the items are fixtures. - Service charge recovery, where the lease permits it, which is a recovery mechanism rather than a funding product. None of these is wrong. They have different consequences, and the consequences show up years later rather than at signature. ## Questions worth asking before signing - Who owns the equipment during the term, and who owns it afterwards? - What happens if the building is sold during the term? Does the obligation transfer, and on what terms? - What happens at lease end, and does this interact with reinstatement obligations? - Is there a security interest registered over the equipment or the company? - What are the exit and early-settlement terms, and what do they cost? - Who is responsible for maintenance, and what happens if the provider stops trading? ## On grants and schemes Support for commercial energy efficiency changes frequently, and eligibility is specific and time-limited. We are not going to list schemes here, because a list of schemes on a web page is wrong within months and someone will rely on it. Ask the contractor what is currently open for your building type and your region, then check whatever you are told against the scheme rules themselves before you factor it into a decision. Treat a quote that depends on a grant as conditional until the grant is confirmed in writing. ## The simple point about payback If a measure pays back inside a few years and you have the cash, funding it is a decision about what else that cash could do rather than about whether the project works. Finance costs money, and across a short payback that cost is a meaningful proportion of the benefit. Funding earns its place where the capital genuinely is not available, where the term is long, or where keeping the spend off the balance sheet matters for reasons beyond this project. ## Questions we get asked ### Should we buy the equipment or finance it? ### Who owns the fittings under a service arrangement? ### Are there grants available? ### Can the cost go through the service charge? Sources - Payback on a commercial LED retrofit depends primarily on operating hours: around a year where lighting runs continuously, and longer in a building lit for normal office hours. [LED revolution puts lighting top of the energy efficiency agenda, Carbon Trust, 2014](https://www.carbontrust.com/news-and-insights/insights/led-revolution-puts-lighting-top-of-the-energy-efficiency-agenda) Last updated 8 October 2026 . - [What it costs The number you would be funding](https://commercialepcupgrades.co.uk/cost) - [Multi-let estates Where recovery questions bite](https://commercialepcupgrades.co.uk/buildings/multi-let-industrial) - [Lease renewal Where ownership resurfaces](https://commercialepcupgrades.co.uk/epc-at-lease-renewal) Next step ## Find out what your building actually needs Tell us the building type, the floor area and the rating you are on now. One commercial contractor comes back to you with a quote. No panel, no cold calls. Or call [07367 293494](tel:+447367293494). Monday to Friday, 9am to 5.30pm.