Commercial solar energy solutions have emerged as a viable option for businesses looking to reduce their carbon footprint as well as save money on their energy bills. While the initial, upfront cost of installing a commercial solar system may seem daunting, the long-term financial benefits are significant, making them an effective long-term investment. Here are some of the ways commercial solar systems provides a good ROI for businesses and reasons to consider a transition to renewable energy:
Lower Energy Bills
By generating your own electricity using solar panels, you can significantly decrease your reliance on the grid, leading to a reduction in your energy bills. Solar panels power your business by generating DC electricity, which is inverted to AC electricity depending on your commercial service (208V, 480V, 600V), resulting in savings regardless. Even if your property consumes more energy than your solar panels can produce, causing the automatic importation of additional energy from the grid, your reliance on the grid remains considerably lower, and consequently, so is your bill cost. Additionally, if your business is requiring less energy than your system is making, excess energy is sold back to your retailer for a credit on your electricity bill. Energy (kWh) exports are monitored through a bidirectional meter.
Generating your own electricity through solar panels provides a lasting advantage, as it enables you to attain energy independence and safeguard against anticipated surges in energy expenses. While businesses that depend on the grid are vulnerable to price hikes, owning a solar system will shield you from such increases since you won't be reliant on external power sources. This means as electricity bills go up, so will your savings!
Solar panels also typically generate enough savings to offset their initial cost in less than half of their warrantied life span. This means that you can enjoy several decades of profitability after the system has paid for itself. Additionally, you can leverage commercial tax incentives and turn unused roof space into profit-making space.
Increased Property Value
Installing a commercial solar system can also increase the value of your property. Solar panels are considered to be a valuable asset and can make your property more attractive to potential buyers, should you be looking to sell your commercial property in the future.
Sustainability Fuels Growth
The installation of renewable energy technology such as solar systems, can contribute to the execution of your ESG strategy and allows you to lead the way among your business’ competitors. Sustainability is no longer something that only major global companies do, but something companies do to fuel their growth. A Forbes article found that 88% of consumers want to shop with companies that support their individual desire to make a positive environmental difference, with the same percentage remaining loyal to such a business. Another study by Forbes found that 87% of consumers will have a more positive view of a company that supports social or environmental issues. No matter what your business offering is, by aligning yourself with a commitment to sustainability and reducing your carbon footprint you may even see increased interest and loyalty among your customer bases, generating more sales.
There are currently many ways to help offset the initial financial cost of a solar asset. The first one comes in the form of increased depreciation under class 43.2 of the Income Tax Regulation. This commercial solar incentive allows a business to write off 100% of the asset value in year 1 of purchase.
The second is a brand-new clean technology tax credit for 30%. This is not dependant on the revenue of the business and companies are eligible since March 28, 2023, when the federal budget was released. Exact legislation is still to be released in the near term.
Kuby Energy is available to discuss how these tax incentives will work for you, however we recommend talking to your accountant when it comes to dealing with depreciation and tax incentives.
Further incentives include selling of their carbon off-sets to generate tens or hundreds of thousands in additional revenue over the first 10 years of their system life.
Lastly, MLI Select has more affordable mortgage loan insurance products when converting to solar energy which is applicable for any developers of multi-unit buildings.
If you have a large-scale project, get in contact to find out if additional incentives may be available.
If you are considering making the transition to commercial solar energy solutions, Kuby Energy can help! Kuby Energy provides clean energy solutions to power your business in Alberta and BC. We’re here to ensure the switch is simple and stress-free. Contact us to get a free quote or to discuss your needs.
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