What Are the Benefits and Advantages of Commercial Solar Panels for Businesses?
If you’re a business owner, the concept of commercial solar panels on your office roof might not seem like it makes sense.
However, if you own a building (or multiple buildings), being able to have solar panels, actually makes great sense for your business and comes with many advantages.
Many small businesses today have discovered that commercial solar panels are an excellent investment.
With more prominent companies such as Apple going to 100% renewable energy sources, it is a great way to enhance the image and appeal of your company.
Let’s take a look at some of the ways that a solar energy system is a key strategic decision that virtually guarantees a solid financial return for your business.
Commercial Solar Panel Costs
The average commercial property owner in California pays around $1,950 in monthly electricity bills.
After a solar panel installation, the electricity bill is typically reduced to $500 a month. This represents a 75% reduction in monthly costs and saving of over $17,000 a year for commercial property.
Of course, this estimated saving does not factor in the cost of solar installation. To do this, you must determine some numbers:
1) The size of your office in square feet
2) The average cost of solar per watt (W)
3) The annual consumption per kilowatt (KW)
According to the U.S. Department of Energy, the average, annual electricity use for commercial building space is 14 kWh per square foot. In 2019, the average national solar panel cost is $3.05/watt.
At the average solar price, this works out to about $18,000 – $40,000 upfront for a small to medium-sized company. However, businesses can apply for a solar Investment Tax Credit that can potentially offset up to 30% of their system cost via a credit that can be used for Federal taxes.
There are also purchasing and financing strategies that can bring this cost even lower.
Even if the solar panel system takes 5 years to pay off, it is still reducing the cost of electricity at the same time and providing a future asset once the system is paid for.
The biggest challenge is to determine how much electricity your business uses. For example, an office with computers, lighting, and air conditioning will use less power than an industrial factory unit with machinery.
The solar panel system size is measured in watts and is dependent on how much electricity you need for your business. The cost of a solar panel system is usually measured in dollars per watt.
Harnessing the benefits of solar energy with commercial solar panels for cutting costs to the electric bill is more than enough reason to make the change. If you’re still not convinced, read on!
Additional Benefits & Advantages of Solar Power for Businesses:
- Federal Investment Tax Credit (ITC): A significant financial benefit for businesses interested in using solar panels. Owners of newly installed solar panel systems get a federal tax credit for 30 percent of the cost of the system. (Some states also offer additional tax credits.)
- Depreciation: Businesses can deduct 85 percent of the value of the solar asset from their taxes, providing another significant offset to the upfront cost of a system array.
- Performance-Based Incentives (PBIs): PBIs, including solar renewable energy certificates, are a way for solar owners in some markets to receive payment from their utility for the solar electricity that their system generates.
Beyond these direct short-term financial benefits, installing solar panels can also help your business to hedge against electricity price volatility and inflation.
In many states, the price of electricity can fluctuate significantly due to demand, or during peak summer and winter months. In this way, going solar makes it easier for companies to budget and plan for the future.
For many businesses considering solar, the numbers add up. Solar panel systems are a smart capital investment for businesses.
With a short payback period, they can provide steady financial returns and help business owners get some relief from rising energy prices.
Considering solar panel for your office or home? G C Electric Solar is the premier commercial and residential solar panel installers based in San Diego, California. Our experienced engineers and solar installers who ensure that your system will be installed according to the highest quality of workmanship available in the industry. We custom design each project based on your needs and pay close attention to all details. Contact us today to see how we can help your commercial business or residence save money with solar panels and decrease energy costs.