What Are the Benefits of Commercial Solar System?

Businesses constantly seek ways to reduce costs and improve their bottom line. Commercial solar offers a compelling solution. Installing solar panels on your commercial building can provide significant financial, environmental, and operational benefits. This blog post will explore the advantages of commercial solar and how it can benefit your business.

Commercial solar offers numerous financial advantages. These benefits can make solar a highly attractive investment for businesses.

• Cost Savings: Solar panels generate electricity, which reduces reliance on the grid and decreases energy bills. The amount of savings depends on factors such as energy consumption, location, and solar panel size. Commercial solar systems can lead to lower energy costs over time due to decreased reliance on the grid and reduced electricity bills [1].
• Tax Incentives & Rebates: The Australian Government offers a range of incentives for businesses installing solar. These include:
  • Small-scale Renewable Energy Scheme (SRES): The Small-scale Renewable Energy Scheme (SRES) encourages businesses to invest in renewable energy by rewarding them for generating clean electricity. If you install a solar system that meets the scheme’s requirements, it earns you credits called STCs (small-scale technology certificates). You receive one STC for every megawatt-hour of clean energy your system produces. These STCs can be sold to an agent, who will either give you a discount on your solar system or pay you a delayed cash payment. The agent then receives the STCs based on how much electricity your system is expected to produce until the scheme ends in 2030. This scheme makes solar more affordable, encouraging businesses to switch to cleaner energy sources.
  • Renewable Energy Target (RET): The Renewable Energy Target (RET) aims to increase the use of renewable energy in Australia. It works by creating tradable certificates called Renewable Energy Certificates (RECs). Each REC represents one megawatt-hour of electricity generated or displaced by a renewable energy system, like solar or wind power. Companies that use a lot of electricity are required to purchase and surrender these RECs, which increases demand for renewable energy. This stimulates investment in renewable technologies, making renewable energy more affordable over time. This also helps to reduce greenhouse gas emissions. There’s also a secondary market where financial institutions, traders, agents, and solar installers can buy, sell, or voluntarily surrender RECs, creating a more active market for renewable energy..
  • NSW Government Incentives: In addition to federal incentives, the New South Wales government offers programs to support the adoption of solar energy, such as:
    • Energy Savings Scheme: This scheme provides financial assistance for businesses that make energy-efficient improvements, including solar installations.
• Increased Property Value: Solar installations can increase property value. Potential buyers often see solar-equipped buildings as more desirable and energy-efficient. This can make your property more competitive in the market.
• Return on Investment (ROI): The return on investment for commercial solar can be significant. Businesses can expect to recoup their initial investment through reduced energy bills and increased property value over time.

Commercial solar provides significant environmental benefits, aligning with growing concerns about sustainability and climate change.

• Reduced Carbon Footprint: Solar energy is a clean and renewable energy source. It does not produce greenhouse gas emissions, which contribute to climate change. By switching to solar, businesses can significantly reduce their carbon footprint. This helps to mitigate the effects of climate change, such as rising sea levels and extreme weather events.
• Sustainability: Businesses increasingly adopt sustainable practices to enhance their brand image and appeal to environmentally conscious consumers. Commercial solar aligns with these efforts and demonstrates a commitment to sustainability. Implementing solar energy can help businesses achieve their sustainability goals and contribute to a more sustainable future. The ability to harness both electricity and heat from solar systems makes them a versatile energy solution for various commercial applications [2]
• Improved Air Quality: Fossil fuel-based power generation releases harmful pollutants into the air, contributing to respiratory problems and other health issues. By reducing reliance on traditional energy sources, solar energy improves air quality and public health, creating a healthier environment for employees and the community.

Adopting solar technology aligns seamlessly with a business’s Corporate Social Responsibility (CSR) efforts and strengthens its green branding.

• Enhanced CSR Efforts: Businesses are committed to environmental stewardship and social responsibility by investing in renewable energy. This strengthens their CSR initiatives and helps them attract and retain customers who value sustainability. It also positions the company as a leader in its industry and builds trust with stakeholders.
• Impact of Green Branding: Green branding promotes a business’s commitment to environmental sustainability. Adopting solar technology enhances green branding and builds a positive association with eco-consciousness. This can increase customer loyalty, improve brand perception, and strengthen a business’s market position. Customers increasingly seek brands that align with their values, and green branding can differentiate a business from competitors and attract a loyal customer base.

Commercial solar also offers operational benefits, improving business efficiency and reliability.

• Energy Independence: Solar panels generate electricity onsite, reducing reliance on the grid and providing greater energy independence. This can be particularly valuable during power outages or times of high energy demand. Businesses can operate with less disruption, ensuring continuity of operations and reducing the risk of costly downtime. Solar energy systems offer increased reliability and an uninterruptible power supply, which benefits businesses [3].
• Reduced Maintenance Costs: Solar panels require minimal maintenance compared to traditional energy sources. This can result in lower operational costs and fewer disruptions to business operations. While regular cleaning and inspections are essential, solar panels typically require less upkeep than traditional power generation systems, reducing maintenance expenses and freeing up resources.
• Increased Reliability: Solar energy is a reliable source of power. Solar panels can continue to generate electricity even during periods of grid instability or outages, ensuring a consistent and reliable energy supply for your business operations. By supplementing or even replacing grid electricity, businesses can experience fewer interruptions and ensure smooth operations, particularly in areas prone to power outages.
• Mitigating Energy Price Fluctuations: Traditional energy sources, such as fossil fuels, are subject to price volatility driven by global market dynamics and geopolitical factors. Solar energy provides a hedge against these fluctuations, reducing reliance on unpredictable energy markets and creating a more stable energy cost structure. This stability allows for better budgeting and long-term financial planning.

Commercial solar installations can significantly increase the value of business properties, attracting potential buyers and tenants.

• Assessing Property Value Enhancement: Solar-equipped buildings are often seen as more desirable and energy-efficient, increasing their market value. The potential for cost savings through reduced energy bills and the positive environmental impact of solar energy contribute to a higher perceived value.
• Tenant Attraction: Environmentally conscious buildings are increasingly in demand. Solar installations demonstrate a commitment to sustainability and can attract tenants who prioritise environmentally responsible businesses. This can lead to higher occupancy rates and more desirable rental terms.

Commercial solar offers a compelling opportunity for businesses in Australia to reduce costs, improve sustainability, and enhance their brand image. From financial savings and environmental benefits to increased energy independence and property value, the advantages of commercial solar are significant.

[1] Healey, H. (1997). Cost-Effective Solar Applications for Commercial and Industrial Facilities. Energy Engineering, 94, 34-49. https://doi.org/10.1080/01998595.1997.10530382.

[2] Spayde, E., Mago, P., & Luck, R. (2018). Economic, Energetic, and Environmental Performance of a Solar Powered Organic Rankine Cycle with Electric Energy Storage in Different Commercial Buildings. Energies, 11, 276. https://doi.org/10.3390/EN11020276.

[3] Tennakoon, S., Keerthipala, W., & Lawrance, W. (2000). Solar energy for development of a cost-effective building energy system. PowerCon 2000. 2000 International Conference on Power System Technology. Proceedings (Cat. No.00EX409), 1, 55-59 vol.1. https://doi.org/10.1109/ICPST.2000.900031.