Top Benefits of Solar PV for Businesses
Climate change is much more than a buzzword. Eco-friendly consumers are now driving big changes in the way businesses operate.
For businesses looking to tap into this trend, a commercial solar installation can be an effective way to boost your brand’s eco-credibility and in turn, drive up revenue potential all whilst reducing overheads.
What Are Commercial Solar Panels?
Commercial solar panels operate on the same principle as domestic solar panels. They convert sunshine into electricity. However, for some commercial applications, larger and heavier solar panels can be used if there is a material benefit in doing so.
What is the Difference Between Residential and Commercial Solar Panels?
Commercial solar refers to the huge solar arrays that you often see on the rooftops of industrial, commercial and agricultural buildings or warehouses. On average, an individual commercial solar panel measures around 2m x 1m. Mypower typically installs systems of between 100kWp and 1,000kWp (1MWp) in peak output size, or approximately 250 to 2,500 panels, generating from around 80,000kWh per annum to over 1,000,000kWh per annum. The amount the systems generate per annum will be dependent on a number of factors such as roof pitch and orientation.
A typical residential system will be around 5kWp and consist of 12-15 panels
Why Invest in Solar Panels for Your Business?
Although businesses are increasingly factoring in sustainability and Corporate Social Responsibility (CSR) when making key operating decisions, they still need to deliver value to their stakeholders. Investing in solar panels for your business can make both economic and environmental sense.
A solar panel installation can give you free (or at least cheaper) electricity during daylight hours and if you finance your solar system, then you’re effectively forward-buying your electricity at current prices. Not only will this keep your Finance Director happy as they will find financial forecasting easier, but you’ll also insulate your business from the rising energy prices that are dominating UK headlines.
However, it’s not only financial futureproofing that your business will benefit from. Consumers are increasingly turning to companies with proven eco-credentials. Installing a commercial solar system demonstrates your commitment to the planet, not only reducing your carbon footprint but also pulling in a new customer base.
Which Types of Businesses Can Benefit Most?
All businesses can benefit from a solar installation, but it’s high-energy users that can benefit the most. Traditionally, businesses in manufacturing, engineering, agriculture, cold storage, and food and beverage production all consume huge quantities of electricity. Overall, the more energy your business demands, the more you’ll likely benefit from making the switch to solar.
What Are the Benefits of Commercial Solar Panels?
Still need convincing? Read on for some of the top benefits of investing in commercial solar panels.
Cost reduction is one of the main reasons businesses start looking into solar panel systems.
With the sun as your main electricity source, you can reduce your electricity bill by up to a third, depending on how many solar panels you install and your consumption rate. Of course, you’ll need to factor in the upfront cost of the installation, but nonetheless, the typical Return on Investment in 2023 is upwards of 20%.
Think of it another way. Each unit of electricity generated by your solar panels is one less that you need to buy from the National Grid. The savings will quickly mount up.
Commercial solar panels typically come with a 25-year warranty, while solar inverters have an expected 10-year life span. Your solar panel system will continue to generate electricity long after this timeframe, albeit less efficiently. Ultimately, your solar panels will last a considerable time, helping your business to achieve cost savings in the long run.
The sun is a truly renewable energy source, which doesn’t produce pollutants or contribute to the greenhouse effect. As long as your site gets a few hours of sunlight every day, you’ll have a viable renewable source of electricity.
Generating your own electricity is a sustainable way to reduce your business’ carbon footprint and can even give you a competitive edge. Eco-conscious consumers are increasingly voting with their feet and solar energy is a visible way of demonstrating to your customers that CSR is more than a tick box exercise for your business.
Global political uncertainties are increasingly having an impact on the UK’s energy supplies and there’s a growing risk of power outages. Switching to reliable solar power can reduce your reliance on the grid supply and the potentially catastrophic impact on your business’ productivity if electricity supplies were interrupted. Back it up with a battery to store excess generated electricity and you’ve got an effective business continuity solution.
For the duration of their lifespan, solar panel systems require comparatively little maintenance as there are no moving parts and the panels are encased in glass and non-corrosive aluminium. Most businesses will only need to arrange for solar panel cleaning every 12-24 months to keep electricity generation optimal.
How Are Commercial Solar Panels Installed?
Commercial solar panels should be purchased from and installed by reputable, qualified solar panel engineers. A commercial solar panel installation project can take anything from 2-3 weeks to 3 months, depending on the scale and complexity of your requirements.
Typically, a feasibility study will be undertaken to determine the viability of your site, as well as your electricity needs. An pre-application process is required to the Distribution Network Operator for all but the smallest systems to gain permission to install and connect a renewable energy system or ‘generator’ to the grid. This process can take months to secure approval, which must be achieved before works are undertaken. A suitable system will be designed for your business and then the necessary administrative tasks will be processed, including obtaining planning permission (if needed). Finally, the panels are installed and connected, and you’ll often be supplied with a monitoring system.
How Much Do They Cost?
The cost of a new solar installation varies from business to business. There are several factors to consider, including how many solar panels you’ll need to meet your electricity demands, how much roof space you have available, and the type of panels you adopt.
A small to medium-sized business consuming over 150,000kWh of grid electricity per annum would typically be looking at a cost of over £50,000 for a system that would make a material reduction in their ongoing electricity costs. Larger, more energy-hungry businesses will be looking at a higher initial outlay. However, it’s worth keeping in mind that the systems typically pay for themselves in under 5 years before any tax incentives, and there are various arrangements available that can help spread the cost of the installation.
How Can You Monitor Solar Panels?
Regularly monitoring the performance of your solar panels is vitally important as it helps you to identify any problems quickly. Many solar panel installations are supplied with an app or a generation meter to help you keep tabs on your system’s output.
To check if your solar panel system is performing as it should, compare your system’s actual performance against your Microgeneration Certification Scheme (MCS) certificate, or if your system is larger than 50kWp compare the installer’s generation projections with actuals. This document is issued to you by your solar panel installer and provides you with the predicted amount of electricity that your system should generate per year.
In Mypower’s experience, our customer’s have typically seen over-performance against our projections on an annual basis, although it must be noted that there are swings from month to month.
Frequently Asked Questions?
How Do You Store Solar Energy?
Installing a solar storage battery will enable your business to store any excess electricity generated during the day. You can then use the stored electricity to take care of any power needs overnight when your panels are dormant.
Are There Any Grants for Solar Panels?
Up until March 2019, the Feed-in-Tariff existed to allow households and businesses to sell their unused electricity back to the National Grid. Instead, the Smart Energy Guarantee (SEG) now pays small-scale electricity generators for renewable energy exported to the grid.
There are very few grants available today to support businesses with the costs of installing a solar PV system, and very simply this is because the systems pay for themselves very quickly. If a business chooses to finance the capital outlay, the savings and income from the PV system will typically cover the loan repayment costs within the first 12 months. This will be dependent on a number of factors those, which Mypower will be able to advise on.
Another way of financing a commercial solar panel installation is with a Power Purchase Agreement (PPA). Under this arrangement, your solar panel system is financed by a PPA provider who then sells you the generated electricity at a cheaper rate than current energy prices.
Can I Claim Solar Panels as a Business Expense?
Investments into qualifying plant and machinery assets between 1st April 2021 and 31st March 2023 can be used to claim capital allowances, under the 130% Super Deduction and 50% First Year Allowance (FYA) scheme. This scheme effectively enables businesses to cut their tax bill by 25p for every £1 they invest. The great news is that solar panels qualify!
Do You Need Planning Permissions for Solar Panels on a Commercial Building?
Yes, if you are installing a system of 50kWp+ you will require a level of planning permission.. Under this size you may be able to install a system under your permitted development rights, however, general exceptions include buildings that are located in a specially designated area like an Area of Outstanding Natural Beauty, or listed buildings. There are also different rules in place for ground-mounted solar systems, with larger systems requiring planning permission to be installed.
Explore Our Solar Solutions
Whether you’re looking to cut the cost of your electricity, reduce your carbon footprint or increase your brand’s appeal, a solar panel installation can help. At Mypower, we’ve had years of experience in providing solar solutions across a range of sectors, including agriculture, manufacturing, and engineering. Get in touch today to find out how we can help your business achieve its potential.