Solar Costs
Integrating solar power into your business will allow you to lower your utility costs and increase profitability while positioning your company as green and forward-thinking. With rates across the country expected to rise at least 5% each year, there has never been a better time to go solar.
The cost of a solar electric system is measured in dollars per watt installed. The average cost of solar has dropped recently - call for a free estimate! The total cost depends on the system size, which is determined by the electricity load of your building or available roof space.
Size matters. When it comes to cost the larger the system the more expensive. Simplex Solar will look at your electric bills to determine the optimal system size for your business. In general, we size systems to offset 50-75% of your electric consumption.
Recognizing the benefits of solar power, many states offer favorable incentives, which can reduce the cost of going solar by half or more. Money is made available if you live in a state with a renewable portfolio standard (RPS), which is a mandate that requires electric utilities to purchase renewable power like solar energy. To view a comprehensive database of the incentives available for renewable energy, visit www.dsireusa.org.
Use our Solar Calculator to calculate the incentives and approximate cost involved when you add solar power to your business.
What Will Reduce My Costs?
Federal Tax Credit:
The federal government offer the
Federal Investment Tax Credit (FITC) for solar. It was initially established for
a finite period of time with a cap, but has now been extended until December 31,
2016 with no maximum credit. Commercial entities are eligible to take this as a
cash grant equal to 30% of the system cost.
State Rebates:
These are upfront payments or a fixed
price per watt provided by your state for installing a solar system.
Pennsylvania, for example, has the PA Sunshine Solar Program, which for
commercial installations rebates the following amount, subject to availability:
3
- 10kW $.75/watt
11 - 100kW $.50/watt
Net metering:
Net metering is a billing arrangement by
which you as a generator of electricity receive utility bill credit for
electricity generated but not used on site. The unconsumed or excess power is
sent back to the utility grid and credited to your next bill at the full retail
rate.
Accelerated Depreciation (MACRS):
The American Recovery
and Reinvestment Act of 2009 allows businesses to recover depreciation
reductions over an accelerated 5 year span assuming the property meets certain
requirements.
AEC/SREC
For each 1,000 kilowatt-hours (kWh), or 1
megawatt-hours (MWh) of clean solar electricity a solar system produces, the
owner receives a digital Solar Renewable Energy Credit (SREC), aka Alternative
Energy Credit (AEC). These are used by utilities to meet their Renewable
Portfolio Standard, and traded on an open market. Prices vary based on the state
in which they are sold.
How Are My Costs Broken Down?
Solar panels:
Panels make up the largest cost of a solar
system, accounting for 60% of the total cost.
Inverter:
The inverter typically accounts for 10% of a
system's total cost. With a 10-15 year lifespan, these often must be changed
once during the 25-30 year lifetime of the panels.
Racking/Mounts:
Racking, wires, and other necessary
hardware make up 15% of the cost of the system.
Labor:
Labor accounts for the remaining 15% of the system
cost.
Monitor Cost:
The hands-off nature of a solar energy
system can make it easy to lose track of the system's daily operation and assure
it is functioning optimally - even if its isn't. Many months go by before a
problem is detected resulting in unexpected high electrical bills, loss of
potential electricity and dollars. As a result, solar monitors are becoming more
widespread. For a low initial cost local PV monitoring can be installed on an
inverter with a built-in monitor. Another option in local monitoring is to
connect the inverter to your computer to log the system data.
Maintenance Costs:
One of the great things about
solar modules is that they have no moving parts and therefore require little
maintenance. The following potential issues are fully covered under our optional
Solar Maintenance Program:
- Soiling: Dust, dirt and bird droppings diminish energy production although normal rainwater is generally sufficient to keep solar panels clean, a low-pressure hose and squeegee sponge can be used to spray the panels clean.
- Cracked Panels: Even though panels are made of glass, they are durable. They are designed to withstand 3/4 inch hail at 120mph.
- Animals/Birds: Squirrels have been known to occasionally chew wires resulting in short circuits while birds have been known to take up residence.
- Trees: Occasional trimming may be required to prevent shading and soiling.
- Corrosion: Electrical circuits can be subject to corrosion.
