Typical solar energy panels for office buildings and commercial properties deliver cost-value benefits that allow you to recover your investment in as quickly as three years. You can protect your business from rapidly rising energy costs, reduce reliance on fossil fuels and become more energy independent by adding solar collectors to your business or commercial property.
Typical Payback Period for Commercial Solar Systems
A payback calculation determines how long it takes to recover money spent on installing new equipment. Calculators estimate savings, tax incentives and operating and maintenance costs to determine how long it would take for a solar energy system to pay for itself through reduced energy needs. One of the key factors in generating the best return from your system is how efficiently you use energy. Installation costs still require a substantial investment, so increasing energy efficiency in your business or building will allow you to reduce the photovoltaic system’s size and cost. Sunshine is free, but you will have maintenance and administration costs to consider. Factors to involve in your budgeting include the following issues:
- Installation costs
- Federal, state and local tax incentives
- Energy rebates from utility companies
- Location of solar array
- Maintenance costs
- Energy costs and price increases
- Type of PV system
Your system might have a payback period that varies from one to 10 years, but life expectancies of solar systems are usually at least 30 years. Costs are not the only benefits of using solar energy; this renewable resource doesn’t deplete the environment or generate greenhouse gases.
Tax Incentives for Energy Efficiency
Costs of solar systems have dropped over the past 10 years. Government incentives include federal tax credits of 30 percent of your solar system costs, and you might qualify for state and local tax breaks. Commercial systems often return solar-power investments in fewer than seven years, because tax credits aren’t capped and MACRS depreciation applies when doing your taxes. New installations, which totaled $30.7 billion in 2009, should climb to $98.9 billion by 2019.
At least 30 U.S. states now issue Renewable Portfolio Standard certificates or SRECs, which allow you to buy and trade energy credits and lock in rates for one to five years. You can presell the SRECs that your system generates to make your planning more precise.
Not every type of solar installation presents identical payback times, qualifies for tax credits or provides energy self-sufficiency, but solar systems make sound financial sense even if you only gain part of the energy that you need. Solar energy installations have become one of the most easily recovered capital investments, and solar collectors provide free energy for decades.