Every business aims to control costs as much as possible and with rising utility bills many owners are looking at solar power as a cost effective solution for their energy needs that is also sustainable and environmentally friendly. While large companies have embraced solar power as a way to reduce business electricity costs, many small and medium sized companies are still in the process of working out how using solar energy as their power source makes financial sense. With advances in solar panel and battery technology leading to ever decreasing costs of buying and installing solar power systems, it is beginning to make solar a viable energy alternative even for smaller businesses.
While sustainability is important, for most business owners the principal driver for the uptake of business electricity costs is to reduce their utility costs. Market data suggests that savings can be substantial with the average commercial property owner able to achieve a 75% reduction in their overall energy bill. The cost of installing a solar power solution can be expensive initially but over the longer term it provides significant savings compared to business as usual. In fact, statistics show that most businesses pay off their solar power installation and capital costs between three and seven years after which the business effectively has free power for the life of the solar system which can be between 25 and 35 years depending on the technology used. In fact most solar providers now offer a minimum 25 year guarantee reflecting the reliability of the current technology.
Aside from the obvious cost savings, solar energy systems come with other financial benefits that make them attractive. The Federal Investment Tax Credit (ITC) can reduce the cost of a solar tax system by over 30% with some states also offering additional rebates. Related to this is the fact that businesses can accelerate the depreciation of their solar energy asset with the ability to deduct up to 85% of the cost in the first year of operation. This can reduce the upfront cost of a solar system significantly. Solar systems also require very little maintenance; since there are no moving parts there is nothing to wear out – most solar panels, for instance, are installed on a fixed tilt system so they simply stay in place pointing at the sun.
Solar energy reflects a company’s social responsibility and green credentials, but even more importantly, as solar energy solutions improve, they also make sense when looking at the bottom line.
