If you're not using space on the roof of your office, factory or hotel for solar panels – you're missing out. PV modules are not only going to cover the energy consumption of your office or hotel, but also improve your business image and eventually pay for themselves in full. In this article we'll introduce you to the basics of commercial solar panel systems.
3 reasons for business to go solar
1. The energy consumption of the whole building can end up being a huge burden on the budget of your enterprise. Solar panels help to alleviate it, if not cover the needs for electricity completely.
2. Solar panels eventually bring the spent money back to you. Payback time depends on the state and electricity prices there, as well as on the type of panels. On average in USA panels pay for themselves in 7-8 years. The average lifespan of solar panels is 25 years, so you can consider them a reliable and smart investment in the future of your enterprise.
3. By installing solar panels and running your business on green energy you reinforce a positive image of your enterprise. Using renewable energy shows that you care about the planet and contribute to the fight against global warming.
Panels differ in cost, lifespan, efficiency and design
There are different types of solar panels which can be used for commercial solar systems. All of them have different advantages and disadvantages, and it's up to you to decide which one to buy.
Stylish black panels, usually with rounded edges, have the highest efficiency (>18%) among the most prominent types of panels. They are one of the best choices when you want to squeeze out as much energy as possible from a square foot. Excel in low-light situations.
Polycrystalline panels are similar to monocrystalline, but have lower efficiency (15-20%) and are cheaper. Usually these panels are blue in color with rectangular-shaped cells. Their lifespan is comparable to the monocrystalline panels – at least 25 years.
The cheapest panels on the market have the lowest efficiency (10-13%). These panels are light, flexible and can be installed with adhesives, so you can put these panels even on the walls of a building. They have the shortest lifespan among three prominent types (10-15 years). Thin-film panels are popular in industrial solar systems and can be a good choice when space is not a constraint.
While the three types listed above are the most widespread commercial solar panels, there are other options to consider as well.
Bifacial solar panels
The backside of bifacial panels can capture sunlight as well as the frontside. Sunbeams go through the panels and reflect from the surface. These PV modules are 11% more efficient than monocrystalline panels, but are obviously more expensive.
Concentrated PV cells
Concentrated PV cells systems also make use of mirrors, lenses and often include cooling systems and solar trackers. This allows them to reach 41% efficiency, but such complex systems cost a lot.
Integrated solar panels
Consider building your factory, hotel or office from scratch? It is possible to customize it and integrate solar panels into the walls. It looks good, but the efficiency of these panels is low. A little warning before we go further: check your roof before installing a solar system. The average lifespan of solar panels exceeds 25 years. If your roof needs a replacement soon, wait for a while to put panels on the new roof. It will be sensible, since removing and reinstalling solar panels is delicate and costly.
Commercial solar systems are bigger and more efficient than residential
The key difference between commercial and residential solar panel systems is obviously their scale. The electricity needs of a business are much bigger, so commercial systems are larger than residential ones. Since space is less of a concern, 72-cell and 96-cell panels are a more popular choice for commercial solar systems instead of 60-cell panels for residentials. The advantage of larger panels is that you can build a system of the same energy production with less modules, therefore spending less money. For the same reason commercial solar panel systems on average are more efficient than residential ones.
It may seem that the installation of a commercial PV system is simpler as it usually takes place on a flat roof. However, buying a solar power system for your business, be ready to wait. Usually you have to coordinate the project with the state and utility company before installation, so the whole process can take from several months to up to a year.
Federal Solar Tax Credit reduces cost of the system by a quarter
Since 2010 the commercial solar panel cost dropped by around 90%. Solar energy now is more accessible than ever. Here are some approximate numbers for solar panel installations:
- 5 kWh: ~ $14,000
- 10 kWh: ~ $28,000
- 25 kWh: ~ $70,000
The price of you installation depends on a variety of factors, such as
- type of panels
- system size
Commercial solar systems are more expensive than residential, but only because they are bigger. The cost of commercial solar panels is, however, lower per watt because of the larger size of panels. What's more, you can save money by increasing the scale of your installation with the Federal Solar Tax Credit (ITC) program.
In short, to encourage people to switch to renewable energy, the state refunds some of the solar installation cost in taxes. For commercial solar systems, whose construction started in 2020-2022, the state proposes a tax credit worth of 26% cost of a solar installation. It drops down to 22% in 2023 and after 2024 it is going to be only10%. Still better than nothing: for residential solar systems this program ends in 2024.
By using the ITC program, you can save up more than a quarter of solar installation cost. Here is how much solar panels for business cost after deducting 26%:
- 5 kWh: ~ $10,400
- 10 kWh: ~ $20,800
- 25 kWh: ~ $52,000
To apply for this program, a solar installation should be located in the U.S. and used by a business subject, which pays taxes for the U.S. government. Thus, charity funds, for example, can't benefit from this program. Here is a full guide on claiming solar tax credit in the United States.
Most commercial solar systems are grid-tie
Just like residential solar panel systems, commercial ones can be off-grid, grid-tie or hybrid. Let's explain the difference between solar systems in a few words:
Grid-tie. You are connected to the utility grid and use solar panels at the same time. All the excess electricity can be sent back to the grid. The utility company, in return, will give you credits, which you can use later to offset your energy bill.
Off-grid. You aren't connected to the grid, rely on solar panels during the daytime and store the energy in batteries for night.
Hybrid. You are connected to the grid, but use solar batteries at the same time. At night you can rely either on the grid or your energy storage. Works well in areas where power outages are a regular occurrence.
The type of system that is going to work best for you depends on your location. If your business is in a remote place where there is no grid or you experience power-supply disruptions, off-grid or hybrid systems are a fair choice.
However, most businesses are located in towns or at least somewhere close to the power lines. This is why almost all commercial solar systems are grid-tie. The scale of systems and the amount of energy they produce rarely make it cost-effective to go for energy storages. Selling the excess energy back to the grid, on the other hand, can significantly reduce your electric bills.