The business case for installing a solar system on your commercial premises is now very compelling. The purchase price of a solar power system has declined dramatically over the past 2 years and this, coupled with recent electricity price rises has meant that the business case for solar is now extremely attractive.

So if your business is thinking of going solar, our consultants will begin by having a conversation about the following:

1. Adequate Roof Space

For solar to be a truly valuable investment, your business needs sufficient, unobstructed roof space. While many businesses are keen to embrace solar, limited or unsuitable roof areas can pose challenges. For instance, some office buildings might accommodate panels, but the energy generated might be relatively small compared to their overall consumption. Without sufficient consumption of the power generated, the economic viability of solar can be limited.

2. Your Power Usage Profile

A large roof alone doesn't guarantee that solar is the right fit. If your business has substantial roof space but relatively low power consumption, solar might not be the most effective solution. Consider a storage warehouse, for example; it might have an expansive roof but only use minimal lighting. In such cases, a significant portion of the generated power would be exported to the grid, potentially yielding little or no financial benefit.

3. Your Business Timeline

Understanding your business timeline is crucial. Solar might not be the ideal direction if your business doesn't have a stable long-term outlook for its current premises. For instance, if you're on a short-term lease or planning to relocate soon, the decision becomes less straightforward. Generally, if you don't anticipate being in the same location for at least 5 years, the return on investment for a solar installation can be diminished.

4. Your Current Power Rate

Finally, we need to understand your current electricity costs. The rate you currently pay for power directly impacts your potential solar savings. Some businesses and retailers may have competitive existing rates that could affect the overall savings projections from a solar installation. As always, our commitment is to ensure solar makes financial sense for your business; if it doesn't, we won't recommend or proceed with an installation.

We treat the installation of any Commercial Solar system purchase as a long term financial investment. Even though you will see short-medium term benefits, we're looking to partner with any business long term relationship. We’ll happily provide you with a customised commercial solar proposal if it is the right decision for your business.

The proposal will then provide details such as:

• Capital Cost
  
• Expected Yields
  
• Investment Returns
  
• Payback Period

A Commercial solar photovoltaic (PV) system is a rooftop generator that converts energy from the sun into electricity that you can use in your business. High quality photovoltaic cells are manufactured together to form solar panels. The direct current generated by the solar panels is converted into alternating current by the power inverter and can be utilised directly within your business or exported back to the grid.

The Renewable Energy Target is an Australian Government scheme designed to reduce emissions of greenhouse gases in the electricity sector and encourage the additional generation of electricity from sustainable and renewable sources.

The Renewable Energy Target is split into two parts: The Large-scale Renewable Energy Target (LRET) and the Small-scale Renewable Energy Scheme (SRES). 

Solar PV Systems up to 100kW are eligible for the SRES and systems above 100kW are eligible for the LRET.

Small-Scale Technology Certificates

Small-Scale Technology Certificates (STCs) are a financial incentive (under SRES) for residential and business owners to install small scale solar installations that are under 100kW. The number of STCs issued is based on how much electricity the system will generate until 2031, with one STC being the equivalent of one megawatt-hour (MWh) of electricity. STCs are like an electronic form of renewable energy currency that can be purchased, sold and traded on an open market. They are commonly allocated to the system provider in exchange for a discount on the purchase price. Their value fluctuates with supply and demand.

For example, a 100kW system (approx. 300-400 panels) will produce around 1,934MWh worth of electricity until 2031, meaning your business would currently receive 1,934 STCs. 

If the value of an STC is $31, you’d receive a $59,954 up-front discount off the cost of a 100kW system.

Large-Scale Generation Certificates

The financial incentive (under LRET) for large scale renewable energy installations such as Solar PV Systems, above 100kW is called Large-Scale Generation Certificates (LGCs), which involves the system has undergoing an accreditation process. One LGC can be created for every megawatt-hour (MWh) of electricity generated. Like STCs, LGCs can be purchased, sold and traded on an open market and their value fluctuates according to supply and demand.

However, the key difference between STCs and LGCs is that LGCs are produced on an on-going basis (once the system has been installed, is producing electricity, and has undergone the accreditation process) as opposed to STCs which are created up-front.

For example, a 200kW system would produce an average solar output of 320,000kWh, or 320MWh. This means they would produce 320 LGCS.

If LGCs are currently trading for $45, this means a 200kW system would receive around $14,400 per year in government incentives.

Solar Power systems deliver benefits in many forms, in addition to being a great financial investment! 

Reduced Energy Costs and Lower Ongoing Business Risk

All businesses in Australia that consume electricity from the grid face uncertainty in the future with the threat of continual electricity price rises. By installing a a Solar system, this allows the owners the ability to produce a portion of their own electricity requirements on site and therefore removing some of this uncertainty and lets businesses take control.

Reduced Carbon Emissions

By installing a Solar System, this can help a business directly reduce carbon emissions. This is because the electricity that is generated from a solar system produces no carbon emissions. Since the electricity is generated “on site” with no transmission losses means the system will offset even more than it generates.

Reduced electricity tariffs

The electricity production of a Solar PV system generally coincides with the peak demand on the wholesale electricity market. This means that by installing a system for your business, your retailer will have less electricity to purchase at a premium rate. The installation of a system may allow a business to negotiate a better tariff  on the electricity that it does purchase. 

Increased Business Statement to Sustainability

By installing a well designed and quality Commercial Solar System, you will be able to make a strong visual statement to your business's commitment to sustainability. The exterior of the building will signal to your key stakeholders that they are dealing with a business that values environmental responsibility.

Increased Competitive advantage

Now more than ever, it is important for companies to seek to increase their competitive advantage over their competitors. It is highly likely your competitors will soon be taking advantage of the benefits provided by a Solar System and lowering their energy costs. Those that are slow to adapt will struggle to innovate and will be left behind in the competitive business environment.