Should your company go solar now or later? Many people opt for solar energy primarily for financial reasons, while others are motivated by environmental benefits. Choosing the right time to transition to solar can significantly impact the outcomes, especially in commercial settings. Besides financial payback, there are additional advantages when adopting solar energy.
Tax credits can be applied when purchasing a solar system, leading to substantial economic savings. Transitioning to solar allows companies to reduce their carbon footprint by preventing greenhouse gases from entering the atmosphere. Installing onsite solar energy is impactful since most commercial buildings emit considerable amounts of emissions. By shifting from brown energy sources to green ones, onsite solar energy could appeal to consumers.
Companies may need to meet specific environmental standards or sustainability goals. Going solar now would be beneficial if these standards are imminent for your company. Solar panels on large commercial buildings make a visible statement, potentially enhancing brand reputation and attracting environmentally conscious customers and employees.
According to a recent Gallup poll, 69% of respondents consider whether a company actively cares for the environment, and one in four describe protecting the environment as a major factor when considering employers.
Solar panel performance is stable; their efficiency or technology will not change drastically over time. Solar panels today are highly efficient and degrade at only 0.5% annually. Waiting for better technology is not a feasible argument as current technology is already advanced.
“Time is money,” and although installing solar panels is costly, traditional energy expenses for commercial companies are even higher. The average payback period for solar ranges between 6-12 years, potentially shorter with today's incentives.
Commercial energy rates in the Midwest continue to rise due to increased demand from large users. Over the past 25 years, utility costs have risen annually by 3-6%. By going solar now, companies can avoid rising energy bills and allocate savings elsewhere.
When paying electric bills, companies essentially rent rather than own their energy source. Installing a solar system means owning the generated energy, providing consistent monthly cash flow compared to variable utility bills.
Currently, there is still a 30% tax credit available for going solar. For instance, an installation costing $100,000 would yield a $30,000 tax credit—a significant saving for commercial businesses whose bills exceed $30,000. However, this credit is scheduled to drop to 26% by 2033.
Deciding whether to go solar now or later depends on various factors such as financial standing and future goals of the business. Companies must evaluate if they have sufficient space for panels or if roof reinforcement or replacement fits within their budget constraints.
Additionally, planning around tax liabilities might influence timing decisions regarding going solar based on anticipated future tax obligations versus current liabilities.
Ultimately, whether a company chooses to adopt solar now or later depends on its unique circumstances and objectives.