Solar power for commercial buildings is the vision of company owners and head managers worldwide. Business expenses for utility use, particularly electricity, go up yearly. It is why business owners choose to shift to alternative power sources, such as solar energy. Business properties, such as office buildings and malls, use electricity for almost everything. Electricity is essential for production, devices, appliances, HVAC, and lighting. Research over decades proved that switching to the use of solar energy lowers utility costs. This article is your best guide for you to understand more about solar, an alternative form of power that your business can use.
Table of Contents
- Solar Power: Does It Fit Your Commercial Building?
- Why Should You Switch to Solar?
- Solar Panels For Commercial Buildings: DIY or Not?
- Financing Your Solar Power Switch
- How To Start Your Commercial Solar Path
Solar Power: Does It Fit Your Commercial Building?
Is your business fit to have this alternative power source? Well, the answer depends on various factors. The best applicants for onsite solar arrays and storage structures are business that:
- Handles several locations with vast, high-quality rooftops or land area
- Want to boost marketing through the solar power campaign
- Needs to lower their business’ energy load requirements
- It aims for customers to see their effort to go for a more environment-friendly power source.
Why Should You Switch to Solar?
Many companies are investing in solar energy and storage. Here are the benefits of changing your energy source to solar.
1. Lowers Costs
The best benefit of solar energy to your business is lowering your utility bill from high to a minimum or even zero. The dramatic decline in costs is typical with solar power. For example, shops that use traditional energy sources pay their electricity at about seven to thirty cents per kWh. On the contrary, those that use solar energy see costs only at approximately two to twelve cents per kWh.
The lowering of cost from shifting to solar energy is under several conditions:
- Industry type
- Facility size
- Activity length and timing
Moreover, the use of solar power is measurable. You can begin small with simple solar panel systems that are at par with your business’ energy needs during the daytime.
2. Earn Revenues from Incentives
Nevada allows incentives like rebates, net metering, and tax exemption for residential and commercial solar users. Net metering permits participants to use their credits without a fixed time limit. You can use the credits to offset utility bills. It is not convertible to cash. Property owners in Nevada can also apply for property tax subsidies to offset their sustainable energy source expenses. The government offers this program to home and business owners in the state.
An additional advantage of shifting to solar energy is the ability to build your solar microgrid. It allows your business to have a low to no risk of power loss from natural disasters. You can even offer more jobs and emergency resources to your community.
According to business experts, sustainability means having the upper hand. Supporting various causes and efforts to promote environmental-friendly ways to everyday living can boost your recognition in any industry. Having the “green” stamp on your branding attracts customers, partners, and investors to your business. Your solar power investment may be your smartest move to quicker success.
Solar Panels For Commercial Buildings: DIY or Not?
The most obvious requirement to put your business money into solar energy investment is a sunny location. If you are in Las Vegas, there is no need for you to worry. Nevada is one of the sunniest states in the USA. Secondly, you need a structurally-sound roof that can support the solar panels and the entire system. A vast land property that can house large solar panels is also a great alternative.
Commercial solar panel systems have various sources. While it is tempting to DIY because of its apparent low cost, you need to think twice before doing such. A solar system for commercial use needs an expert on electrical design for optimum results.
Things You Should Explore Before Switching to Solar
Now, you know some essential concepts about solar electricity. But, for sure, you still have lots of questions in mind. Here are the commonly asked questions that may widen your knowledge about solar power for business use.
1. Does your business use electricity during daytime, night time or both?
The number of solar panels for commercial buildings depends on your business’ daily electricity consumption. You can add more panels if you want to store electricity for long-term or future use. Some companies sell their excess energy to local electric utilities. This move allows them to profit more.
2. Can you seek financial support to purchase a solar energy system?
Businesses that are interested in investing in solar power can use various ways to finance it. Your decision can depend on several factors such as:
- Availability of voluntary cash
- Business energy requirement
- Size of commercial building
- Scope of the energy system
- Need for fast ROI (Return on Investment)
Most companies choose to buy their solar systems through business loans, cash, or a mix of both. Cash deals offer better ROI because the business owner can immediately apply for incentives and tax returns. Cash loans allow companies to pay their system throughout a term with specific terms and conditions.
3. Can your business apply for solar rebates and incentives?
You can assess if your business is eligible to apply for different programs in Nevada.
- NV Energy’s Business Energy Efficiency Rebate Program
This program is available for commercial, industrial, and institutional businesses operating in Nevada under NV Energy. Rebates and the conditions vary based on whether the solar system installed is for a new building or an existing one.
- NV Energy Solar Generations Solar Heating
It offers an incentive for small business owners, non-profit organizations, and homeowners who install solar pool heating, solar water heating, and solar space heating in their properties or buildings.
- NV Energy Storage Incentive Program
NV Energy gives incentives to business owners and homeowners who install energy storage systems to their buildings or properties. A customer must already have an existing system or currently installed one with a storage system to qualify. Facilities with standalone systems are ineligible for this program. NV Energy offers two levels of incentive-based on the rate schedule. Those who are on a time-of-use rate may have about $0.22 per wH. Those who are not can have around $0.11 per wH.
These programs can significantly decrease your utility cost by about 30%. For businesses engaged in agriculture, solar power use offers utility-specific incentives and select financing options from various government and financial agencies.
Financing Your Solar Power Switch
There are numerous ways to finance your solar power investment. First, obtain the specific requirements of your business. This information will help you compute the cost and time to have your ROI. Also, take note that utility rates differ from one state or city to another. It is best to seek advice from your local solar system provider and installer to calculate your needs and benefits.
Understanding your business cash flow, income goal, and tax appetite will help you know the financing option to choose. Popular types of financing used for commercial solar systems include:
Business owners can decide to buy their solar system by paying 100% upfront. This cash payment allows them to qualify for various federal tax rebates and incentives. The estimated IRR (Internal Rate of Return) on solar energy systems’ cash purchases is 30%. Investment returns typically start in less than two years of solar energy use.
Most bank loans offer 0% down payment for a loan duration of 7 years or more at an average of 5% interest.
- Operating Lease
This financing option does not need any down payment. It comes with a ten-year term at approximately 6% interest.
Most providers also offer future buyout options to lessees. Investment returns begin at year one.
- Power Purchase Agreement (PPA)
PPA offers no down payment under a twenty-year rate of $0.943 per kilowatt-hour. Cash flow becomes better after a year.
How To Start Your Commercial Solar Path
Now, the question is, what is your next step?
We have a three-step guide for you as you start shifting from traditional energy sources to commercial solar use.
Step 1: Identify your financial goals.
First, ensure that your solar energy requirement measurement is accurate. You have to assess your business’ current utility costs according to the location of your region. Analyze if going for a sustainable energy source will boost your environmental profile with the community, stakeholders, and customers.
Step 2: Obtain data on your yearly energy usage.
Study your business’ electric consumption and bill in the last six to twelve months. This data should be enough to predict your consumption pattern. Nevertheless, make allowance for peak seasons, which typically have higher rates. Also, look into outages and unscheduled overtime. These unforeseen occurrences affect your business’ electric consumption as well.
Step 3: Team up with a solar energy specialist.
Many commercial solar projects fail because business owners either choose to do DIY or pick the cheapest offer. The best you can do is find a professional solar expert with vast experience with local contractors and various industries.
Going solar is a critical decision to make for businesses. It entails money, time, and effort to make the change successful. Understanding the concept of commercial solar energy is essential to find the best solar expert that can guide you throughout the process. Nevertheless, the thought of using a sustainable source of energy is already great. Going through the change may be challenging, but the benefits of using the sun’s energy are outstanding.