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Factors to Evaluate When Buying a Commercial Solar System

February 13, 2024


Utilizing pure energy, commercial solar panels are an excellent way for businesses to reduce or even eliminate their electric bill. With a commercial solar installation, electric costs can be virtually eliminated, which is fantastic for reducing expenses and increasing cash flow. Buying commercial solar panels does entail an initial expenditure. ...

Utilizing pure energy, commercial solar panels are an excellent way for businesses to reduce or even eliminate their electric bill. With a commercial solar installation, electric costs can be virtually eliminated, which is fantastic for reducing expenses and increasing cash flow. Buying commercial solar panels does entail an initial expenditure. However, the long-term total return on investment (ROI) for solar energy makes it an obvious choice.

It is common knowledge that fossil fuel combustion is detrimental to the environment.

The importance of transitioning to cleaner energy sources is growing.

When contemplating the installation of a commercial solar system as an alternative energy source, there are critical factors that must be taken into account by your business.

Let us examine several items in order to inform your decision.

What is the sustainability rating of a commercial solar system?

Implementing solar energy systems enables businesses to mitigate their reliance on fossil fuels and substantially reduce their emissions of greenhouse gases.

Solar energy reduces air pollution caused by the combustion of fossil fuels and natural gas because it is a pure, renewable energy source.

The electricity sector in the United States is responsible for approximately 29% of global warming emissions.

Several hundred thousand metric tons of carbon dioxide emitted by conventional energy sources can be mitigated by commercial solar systems.

To put things into perspective, solar energy emits only 0.07 to 0.2 pounds of carbon dioxide per kilowatt-hour, whereas coal emits 1.4 to 3.6 pounds.

This represents a reduction of 70% in carbon emissions.

Additionally, solar systems operate without a water supply.

This results in decreased water pollution and enhanced public health.

By implementing a commercial solar system, your organization will significantly contribute to the preservation of our planet and the environment.

Solar systems may eventually contribute to more stable energy prices as solar energy becomes more accessible and affordable over time.

What Is the Optimal Commercial Solar System Orientation?

For maximum solar energy, the sun’s beams should strike your panels perpendicularly.

Therefore, the following should be taken into account when organizing the orientation of your panels:

  • It is recommended that the panels be oriented in the direction of the equator of the Earth. When situated in the Northern Hemisphere, orient your panels in the direction of true south. When situated in the Southern Hemisphere, orient your panels in the direction of true north. It should be noted that the longitudinal lines depicted on a map, not cardinal directions, inform these particulars.
  • Angle: It is customary to orient the panels at an angle that corresponds to the geographical latitude. As an illustration, configure your panels to a 25-degree angle if you are situated at 25 degrees latitude. To prevent snow and detritus accumulation, tilt your panels at a steeper angle if you reside in an area that experiences heavy snowfall.

What is the energy objective of your company?

Prior to determining the budget for a commercial solar system, your organization should evaluate its energy objectives.

Do you intend to reduce your energy expenditures?
Are you targeting the commercialization of solar energy?

One is presented with a variety of choices.

Solar Carports

In addition to recharging electric vehicles, solar carports can supply power to a business.

They are capable of producing energy equivalent to that of conventional rooftop solar systems.

On certain occasions, they may offer even greater energy output due to their simpler orientation to optimize solar power.

Carports are excellent options for small businesses with small property lots due to the fact that installation does not require additional land.

Solar Panels Mounted to the Ground

When a company possesses expansive land, ground-mounted solar panels may be implemented.

Ground installation provides the optimal orientation and inclination to capitalize on the sun’s rays, thereby increasing the efficiency of your solar panels.

By installing a dual-axis tracking system on your panels, you can increase their efficacy even further, resulting in a 40% increase in electricity output over fixed installation roof panels.

Since you do not have to move 40-pound solar panels across a rooftop, ground-mounted systems are safer to install and maintain if you are considering doing it yourself.

Grid-Tied systems

Typically, commercial solar systems are connected to the utility.

This signifies that the system establishes a connection with the power grid and exchanges any surplus energy for renewable energy credits, which are utilized when the grid is drawn down for power.

Although considerable progress has been made in developing solar panels with improved efficiency, it is still imperative for businesses to have a grid-connected solar system in order to secure reserve energy.

What is the approximate expenditure on a commercial solar installation?

A final price for commercial solar systems is determined by a number of factors, including:

  • Dimensions
  • Elements
    Design
  • Labor and permit expenses

In general, the total cost is expressed in dollars per watt.

At present, the mean expense ranges from $2 to $4 per watt.

The price range for a commercial system with a capacity of 56.4 kW is $113,000 to $226,000, exclusive of any applicable tax credits.

These factors are crucial in determining which solar panel installer to hire for your business, as they have a significant financial impact.

Solar panel efficiency is determined by comparing the power generation capacity of the panel to the quantity of sunlight it receives. Panels that are capable of converting a minimum of 20% of the incident sunlight are regarded as exceptionally efficient. As the efficiency of the panels increases, the installation effort required will decrease.

  • Battery storage capacity contributes to cost savings through reduced battery replacements.
  • Warranty packages should specify the types of damages that are protected by the warranty.
  • Additional Services Provided: Determine whether your installer offers custom designs or routine repairs as ancillary services for your solar system.

In order to ascertain the requisite number of solar panels for supplying sufficient power to a business, an assessment of its present energy consumption is imperative.

Six months to a year’s worth of electricity invoices should be analyzed to obtain a more accurate picture of your average daily energy consumption.

Increasing the sample size will result in more precise estimates.

Additional considerations include:

  • Availability of space
  • Levels of local solar exposure
  • Potential future expansions
  • Natural deterioration of solar panels

If you are uncertain about the number of solar panels to install or the type of solar unit you desire, it is advisable to consult with a professional solar installer for guidance.

Verify that you have the necessary permits and legal documentation to install a commercial solar system in accordance with the safety and zoning regulations of your area.

Your solar panel installer, thankfully, handles the majority of the required documentation.

Nevertheless, it is advisable to ascertain your own requirements before placing complete reliance on your solar provider.

You must submit applications for the following:

  • Electrical and building permits
  • Interconnection agreement with your local utility company
  • Applications for state and federal solar incentive programs

It is particularly crucial to submit applications for solar incentive programs in order to potentially qualify for tax credits, rebates, or other forms of financial aid that can help defray the expenses associated with installation.

Certain sales taxes and tax credits may be applied toward the cost of solar panels, labor, equipment, and energy storage devices.

Bear in mind that the completion of all required legal documentation could take weeks or even months.

You may require “permission to operate” from a government representative once your commercial solar system is operational.

This PTO ensures the correct wiring and electrical work on your system.

Additionally, a representative of the utility company will link your system to the electricity grid.

What Kind of Profit Can You Expect from a Commercial Solar System?

While a substantial investment is required to construct a commercial solar system, tax rebates and solar incentives accelerate your return on investment.

Solar Investment Tax Credit

The solar ITC was established in 2006 as a federal tax incentive.

Eligibility is determined by a “commence construction” criterion that is assessed using one of the subsequent methods:

One requirement is that your organization provide evidence that it is commencing physical labor that is deemed “significant in nature.”

The 5% Safe Harbor Test requires an organization to substantiate that it is remitting payment of the entire cost of the facility in the year construction commenced, or a greater amount.
For both of these examinations, the Continuity Requirement is present.

It is expected that projects will be finished or operational by the conclusion of the fourth calendar year subsequent to the commencement of construction.

Failure to complete the project within the specified timeframe prevents a business from “failing” this requirement due to disruptions.

Qualifying disruptions include:

  • Severe weather conditions
  • Natural disasters
  • Permit delays
  • Supply shortages

The credit terms are as follows, contingent on the commencement of construction:

The following percentages apply:

  • 26% for projects initiated prior to December 31, 2020;
  • 22% for projects initiated prior to December 31, 2021;
  • 10% for projects initiated prior to January 1, 2022.

Net Metering

A business that installs a commercial solar energy system could potentially qualify for net metering.

Through net metering, you can exchange your excess solar energy for credits from your utility provider to use during cloudy days or at night.

Two general net-metering programs exist:

Your utility company calculates excess energy and credits your account with the amount to be applied to future utility expenses.

The surplus energy is quantified using an electricity meter. When you draw energy from the grid, typically in the evenings, modern meters will tally up; conversely, they will count down when your panels generate excess energy.

In both programs, only the net consumption will be billed.

Eliminating the need for electricity altogether during the winter months is feasible if an adequate amount of surplus credits is accumulated during the sunny months for use in the winter months.

Note that state regulations regarding net metering differ.

Determine whether net metering is accessible in your region.

Solar Installers Near Me is dedicated to identifying the optimal solution for your company while granting you the autonomy to implement it in your preferred manner.

Regardless of whether your organization possesses the capability to install solar panels on its own or would rather have our team handle the installation process in its entirety, we are prepared to accommodate your vision.

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