Solar panels provide are an effective way to generate your own electricity, plus they can benefit your business and the environment simultaneously. As the price of business electricity continues to rise, company managers will need to find new solutions to offset these expenses. This is where investing in commercial solar panels may just be the right solution for your business.
Before considering solar panel technology, you will ideally want to own your business premises, or at the minimum have a long-term lease in place. This is because your investment in solar panel technology, like any other form of renewable energy, will take a number of years to give you a return on the initial investment. If this isn’t a viable option for you right now, you can still compare business energy prices to save money. Want a sustainable option? Filter tariffs to show renewable energy plans.
- How can commercial solar panels benefit my business?
- What does the average commercial solar panel cost?
- Are there any grants available for investing in commercial solar panels?
- What other renewable energy options are available?
How can commercial solar panels benefit my business?
Throughout the world and here in the UK, the price of electricity keeps increasing each year. This has led many businesses to explore new ways to lower their energy costs. Investing in UK commercial solar panels is a wonderful way to reduce your business energy expenditure.
Solar panels for business can deliver electricity at an average of 5p per kWh – this is simply incredible when you realise that the average cost of electricity is usually between 11p and 15p per kWh.
Company managers and owners will not be surprised to learn that the price of energy is set to rise, after all this has been a regular occurrence for decades. Over the next ten years, it is estimated that the average business energy bill will double. For this reason alone, it makes sense to consider investing in commercial solar PV. This will exclude you from skyrocketing prices as you will be generating your own electricity.
Furthermore, excess energy generated through commercial solar panels can be sold back to the National Grid. To do this, you will need to negotiate a Feed-in Tariff. This is a government subsidy for businesses who produce excess renewable energy, allowing them to make money by transferring what isn’t used back to the National Grid.
Unfortunately, this scheme is no longer available to new applicants as of March 31, 2019. However, your business may still be eligible for payments. Learn more in our Feed-in Tariffs guide.
Saving money isn’t the only benefit when investing in commercial solar energy. Purchasing and installing solar panels for your business premises will also decrease your carbon footprint. This corporate sustainability responsibility can in fact help you attract more clients and customers too.
What does the average commercial solar panel cost?
On average, the price of commercial solar panels ranges between £3,000 and £10,000. There are two different types of systems you can select from.
- Solar thermal energy (£3,000 – £5,000)
- Small-scale photovoltaic (PV) systems (up to £10,000)
Solar thermal energy uses sunlight to heat water that is stored in your hot water tank. They are attached to the side of your building and produce steam to generate electricity.
Solar PV panels are the panels you will typically see on roofs and the sides of buildings. They convert sunlight into electricity by creating an electric field between the cells which make up the panel.
The more you invest, the better technology you will be able to obtain for your commercial solar PV system. If you have the available budget, it is worth spending a little extra to gain the maximum benefit.
At first glance, the initial cost may seem quite high, but this will definitely pay off over a longer period. This is further compounded for those who own their business premises or have agreed a long-term lease and aren’t planning a change of tenancy anytime soon. Solar thermal energy systems usually take around five years to cover the costs of your initial outlay. Whereas, with small scale PV systems, you can expect to have earned back your initial investment between five and ten years.
Investing in commercial solar energy panels can protect you against fluctuations in the wholesale electricity market. Similar to any business or life decision for that matter, long term projects always bear the most fruit. Yes, you will pay a large sum upfront, but over time, the cost savings are more than worth it.
Are there any grants available for investing in commercial solar panels?
Alongside the aforementioned Feed-in Tariff, there are a number of additional government initiatives which can help you invest in solar panels. These are as follows:
The Green Deal
The Green Deal allows you to pay for installation costs of energy-saving technology, such as solar panels, through savings within your energy bills.
Enhanced Capital Allowances
Enhanced capital allowances give you the opportunity to offset the cost of your business equipment against your taxable profit.
You may also find it useful to check out our business energy VAT guide.
Lease Purchase Agreements
A lease purchase agreement enables you to rent out your renewable energy equipment and pay for it via income earned through subsidies. Once the total cost has been paid, you will then take full ownership of the system.
Here are some other options available to firms:
- Client funding
- Business loans
- Power purchase agreements
Investing in commercial solar panels will require a lot of thought and planning. It isn’t always straightforward when you are searching for the best solar panel company, information on the installation process, understand the costs and find out what subsidies are available. This is why Utility Saving Expert is here to help.
What other renewable energy options are available?
There are a number of renewable energy options available to businesses of all types and sizes. Just like solar panels, many will grant you access to similar government subsidies and tax breaks. Here are some alternative options:
- Wind power – Have a large amount of land free of building space? You can generate electricity through a wind turbine.
- Biomass systems – Burn organic materials like straw or wood pellets to generate electricity and heat.
- Hydroelectric power – This uses the flow of water to generate movement which will, in turn, generate electricity. These are only available for sites that have a water source and enough land for the technology.
- Geothermal and ground source heat pumps – These take heat that is naturally contained within the ground. Pumps are attached to the side of your building and provide both heating and cooling.
To get a more comprehensive understanding on all of the above, you may find this renewable business energy guide useful.