Continue reading to learn how you can generate income with commercial solar panels for business and how quickly you can see a return on investment (ROI).
How Solar Power Can Generate Income for Your Business
There are two main ways that solar can generate income: through net metering and solar renewable energy credits (SRECs). Solar energy incentives vary state by state.
This billing system gives business owners who generate their electricity from solar panels the opportunity to sell excess power back to the electrical company.
When your solar system produces more electricity than your business needs, the excess electricity goes back to the grid. In return, you receive credits that offset the cost of power that you need to use in the future.
Energy credits are a great way to generate additional income for your business and can shorten your payback period. Your company will be able to reduce or eliminate your electric bill.
SRECs can be traded or sold to utility companies, solar developers, or solar brokers. The number of SRECs that your business can earn each year depends on the amount of solar power that your solar energy system generates. The price of an SREC varies depending on market conditions and solar policy.
Can Your Business Profit from Commercial Solar Power?
The amount of revenue that your business can generate from solar depends on multiple factors:
- The amount of solar power that you produce. The more sun your roof gets, the more green energy your solar energy system will produce.
- The buyback rate in your state from SRECs. The buyback rate is the amount of money that the utility company will pay you for each solar energy credit. By generating extra energy credits, you can potentially eliminate all your electric utility costs and even make a profit.
Cost of Commercial Solar Panel Installation
The cost of solar installations has dropped significantly in recent years, making it a more viable option for businesses. Tax credits and incentives can help offset the cost of your commercial solar system.
Here are a few solar energy incentives that may be available in your area:
- Federal tax credits. The solar investment tax credit is a government tax credit that enables your business to deduct 26% of the cost of your commercial solar installation from your taxes.
- State incentives. These incentives vary by state but may include tax breaks, rebates, and other financial incentives. Some states require utility companies to offer solar credits for power sent back to the grid.
- Depreciation deduction. Businesses can deduct a portion of the cost of commercial solar installations from their taxes over five years with accelerated depreciation.
ROI of Solar Panels for Business
The ROI of solar systems depends on several factors, including government incentives, the cost of solar installation, and the amount of sun that your property receives.
Commercial solar system payback period
The solar energy system payback period is the time that it takes for your energy system to generate enough energy credits to offset the installation costs. In most cases, the payback period for solar power ranges from five to ten years. However, this varies depending on your commercial solar system and utility costs in your area.
The lifespan of solar panels
Commercial solar panels for business typically range from twenty-five to thirty years. After the payback period, your solar energy system will generate clean electricity and create an income stream for your business for decades to come.
Get Started Generating Income from Solar Energy
Solar power is the answer if you’re looking for alternative ways to generate income from your roof, unused property, or parking lot.
Solar energy can help you quickly get a return on your investment and give your business the ability to reinvest back into your business. Commercial solar energy systems will provide your business with a long-term income stream from clean energy and positively impact the environment.
At Geoscape Solar, we help businesses utilize solar energy for profit. Your business will become energy independent, be able to decrease utility costs, and leverage available solar incentives for a quick ROI.
To discover how installing solar energy on your property will increase your business profitability, contact one of our energy specialists!