Commercial Solar Panel Cost Guide: What to Expect and How to Save
The commercial solar trend is booming in the U.S. as businesses are now seeking solutions for offsetting high energy expenses and mitigating long power outages. According to SEIA, commercial solar installation may help to reduce up to 75% of energy costs. Furthermore, 2.5 million commercial systems have been installed yet. However, according to NERL, the cost of installing commercial solar panels has decreased by around 2/3 since 2010. Also, state tax credits and solar incentives by state, etc. make it an attractive move to embrace clean energy.
For businesses, it is important to do a cost-benefit analysis to make an informed decision about solar investment. In this guide, we will break down all the cost factors and also share tips to maximize your solar savings.
How much do commercial solar systems cost?
Every commercial installation is different. Many variables affect the cost of commercial solar panels. In a large warehouse and a small boutique shop energy use varies, so system size is important. Also, Different solar panel types have different costs and levels of efficiency like polycrystalline, thin-film, and monocrystalline panels. Moreover, the energy needs determine the cost; larger companies typically use more. However, analysis will help assess the feasibility and return on investment (ROI) of installing commercial solar panels for your business.
The Solar Energy Industries Association states that as of 2023, the average cost of a commercial solar panel system is $1.66 per watt. This is over 50% of the $3.27 per watt installation cost for residential solar.
What are the factors impacting commercial solar panels cost?
Let’s break down the factors impacting commercial solar panel costs:
- System Size: The size of the solar array affects the overall cost. Large system size requires more solar panels and other solar equipment which leads to higher costs.
- Solar Panel Efficiency: Another vital factor for depicting cost is the solar technology and brands. Generally, high efficiency PV panels are expensive. However, they provide high energy output leading to maximum solar savings.
- Mounting Systems: Costs may vary depending on the type and complexity of mounting and racking systems required for the installation. Different installation types like roof-mounted, ground-mounted, etc. have different labor, solar engineering, material, and permitting needs.
- Solar Equipment: Solar inverters are essential components for converting DC into AC. The high-performance inverters cost high. Also, additional solar equipment including wiring, meters, backup solutions, etc. all impact the initial installation cost.
- Solar Permitting: There may be additional expenses for system modifications, paperwork, and inspections to comply with local codes, solar interconnection requirements, solar permitting requirements, and regulatory requirements.
- Commercial Solar System Installation Cost: All expenses related to the commercial solar system installation, such as choosing qualified experts or subcontractors, may affect the final cost.
- Warranty & Maintenance: It’s necessary to consider the solar system’s warranty coverage and ongoing maintenance expenses. Equipment and warranties of a better level could cost more.
How can you lower the commercial solar installation cost?
To encourage businesses towards solar, the states and local utilities are offering several commercial solar incentives, rebates, and tax credits. These programs aim to help you reduce your upfront installation cost. Some of the best incentives include:
Investment tax credit: One important federal incentive for solar installations is the Investment Tax Credit (ITC). Companies may deduct 30% of their solar installation expenses from their yearly taxes. Businesses find solar investments more appealing and financially feasible as a result of this tax relief.
Local incentives: To encourage companies to switch to solar power, several localities provide incentives. For example, Austin Energy offers its solar customers a $2,500 post-installation rebate. The initial expenses of solar installations can be decreased by these local incentives.
Net metering: Net metering allows businesses to send solar energy back to the grid in exchange for credits on their monthly utility bills. There are statewide net metering programs through local utility companies. This system ensures that businesses benefit from their excess energy production, further enhancing the financial viability of solar installations.
Sales tax incentives: When installing a solar panel system, sales tax incentives provide an exemption from the state sales tax, also known as the sales and use tax. This allows business owners to pay additional taxes due to the value added by their solar panels.
What are the cost savings & Return on Investment on commercial solar?
Commercial solar cost involves the price of panels and other costs such as installation, equipment, etc which could be slightly high at the beginning period. However, other financial incentives can culminate in cost reduction. Also, many financial incentives can substantially decrease the upfront. Thus, once the cost of the system is paid back, your business will produce free energy.
Continuous Monthly Energy Savings: Solar panels provide free, passive energy for decades, reducing monthly energy bills.
Energy Price Stability: Solar energy protects your business from high energy costs keeping your business financially secure in the future.
Increased Property Values: In general, properties with installed solar are more valuable and sell more quickly as compared to those that do not have photovoltaic systems.
Corporate Reputation: The public is increasingly becoming more conscious of the environment, and thus, if your enterprise is contributing to the environment increases consumer trust and sets your business apart from others.
Investing in commercial solar is not just about cutting costs; it’s about securing your business’s future. SolarSME is dedicated to helping you navigate the transition to renewable energy seamlessly. Our expertise ensures that your investment is optimized for maximum savings and efficiency, empowering your business to sustainably. Join the businesses that have already reaped the benefits of solar power, and take a step toward a greener, more resilient future.
Ready to reduce your operational costs? Start your solar journey with SolarSME and secure a sustainable future for your business. Book a FREE consultation!
