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How Much Do Commercial Solar Panels Cost ?

Solar power is an ideal choice for businesses aiming to cut down on operating costs and enhance their overall profitability. In addition to minimizing the company’s environmental impact, adopting solar energy sends a clear message to customers and stakeholders about the company commitment to sustainability and the transition to renewable energy.

Businesses can figure out how much money they might save by checking how much industrial solar power costs. Sometimes, solar power is cheaper than regular electricity, which can save a lot of money in the long run. Governments might give money to help with solar power installations, and knowing the commercial solar panels cost helps businesses see if they can get these benefits. By knowing the cost of solar power and how does a commercial solar system work, businesses can see if they can get help from the government.

Average Cost of Commercial Solar Systems By Size

The commercial solar power system cost in california is around $2.91 to $3.20 per watt (including installation) and before tax rebates . If you’re paying this amount, you should expect excellent customer service throughout the 25-year lifespan of your solar panels. 

So, for a 5 kW solar system installation, it woll cost you around $14,558 before incentives, prices can range from $12,374 to $16,742, though. The average price drops by 30% after the government tax credit. For small to average-sized businesses, the cost may range between $50,000 and $100,000, with a 26% federal tax credit available.

System Size

System Cost

System Cost (after ITC)

3 kW

$8,735

$6,114

4 kW

$11,646

$8,152

5 kW

$14,558

$10,190

6 kW

$17,469

$12,229

7 kW

$20,381

$14,267

8 kW

$23,293

$16,305

9 kW

$26,204

$18,343

10 kW

$29,116

$20,381

What are Commercial Solar Systems?

Commercial Solar Panels Cost

Commercial solar systems, also known as solar arrays or photovoltaic (PV) panels, are large grid-connected systems installed on the rooftops or grounds of commercial properties. They generate solar power to meet the energy needs of businesses.

Numerous businesses and organizations have embraced commercial solar energy systems, including:

  1. Vineyards, farms, and ranches
  2. Warehouses and factories
  3. Clinics and hospitals
  4. Schools and childcare facilities
  5. Parking lots and garages
  6. Commercial office buildings
  7. Retail stores and shopping centers

A diverse array of businesses can derive substantial benefits from solar energy.

Where Are Commercial Solar Installations Possible?

Commercial solar systems offer versatility in installation, catering to diverse structures and environments for organizational use. In contrast to utility-scale plants, mainly ground-mounted solar farms, and residential solar setups primarily located on home rooftops, the demand for commercial solar panels is high. Service providers in this sector operate from various locations.

Here are some examples of where commercial solar installation can be done:

  1. On flat roofs or other level surfaces
  2. Sheds and barns
  3. Awnings and rooftops of commercial buildings
  4. Patio coverings, gazebos, and pergolas
  5. Parking shades and garages
  6. Mounting poles
  7. Ponds and artificial lakes, often referred to as photovoltaics.

This demonstrates the adaptability of commercial solar panels in terms of deployment locations.

Determining Commercial Solar Panels Cost Using PV Watts

The size and location of the solar system significantly influence the cost of commercial solar panels. PV Watts provides a straightforward method to calculate your buildings sunlight exposure. Developed by the National Renewable Energy Laboratory (NREL), PV Watts is a tool designed to estimate the energy output and cost of global photovoltaic (PV) energy installations.

To assess the sunlight exposure of your commercial building, PV Watts utilizes your facilitys address and weather information. By entering your buildings address into the Input a house or business address section on PV Watts and following the provided instructions, you can determine the cost of implementing an industrial solar power system.

Efficiency is a crucial factor in commercial solar power systems. Most solar panels have an efficiency range of 15% to 20%. When the sky is clear around noon, the sun’s energy reaches the Earth’s surface at approximately 1,000 watts per square meter. PV Watts defaults to this 1,000 watts per square meter standard.

Considering a 15-20% efficiency solar panel under ideal conditions, a 1 square meter commercial solar panel would generate 150-200 watts of electric power per square meter. The solar panel array displayed on your roof using PV Watts is measured in square meters.

PV Watts offers three types of solar panels, each with a different efficiency rating:

  1. Standard: 15% efficiency (crystalline silicon/glass)
  2. High-end (crystalline silicon with an anti-reflective coating): 19% effectiveness
  3. Thin Film: 10% efficiency (thin film/glass)

Choosing the appropriate type of solar panel depends on efficiency, cost, and specific project requirements. PV Watts provides a valuable tool for assessing these considerations and estimating the potential output and price of your commercial solar power system.

Soalr Investment Tax Credits and Advantages of Commercial Solar Power System

Enterprises, governmental agencies, and nonprofit organizations have compelling reasons to adopt solar energy, with various advantages and incentives associated with commercial solar panel systems:

1. MACRS Depreciation:

The Modified Accelerated Cost Recovery System (MACRS) allows a recovery period of five years for solar energy equipment. Given the guaranteed lifespan of solar panels (at least 25 years), businesses benefit from substantially reducing tax obligations during the initial five years of system ownership. This depreciation can be combined with the solar tax credit, enhancing financial benefits.

2. Flexible Financing Possibilities:

Commercial solar financing offers flexibility through various payment options:

Solar Lease: Businesses pay a fixed monthly fee to use solar panels from a solar company.

Solar Loan: Obtaining a loan covers the cost of solar panels, payable over five to twenty years.

Power Purchase Agreement: Companies agree to pay a predetermined price per kilowatt-hour for electricity generated by the solar panels.

Solar leases and Power Purchase Agreements may not qualify for tax credits, but solar systems purchased with a solar loan are eligible. Solar loans often provide the best return on investment.

3. Tax Credits for Solar Energy and Other Incentives:

The Solar Tax Credit, or Clean Energy Credit, subsidizes 30% of the installation cost of solar panel systems. For example, a $50,000 investment in a solar power system would result in a $15,000 tax credit. Additional utilities, states, and local government incentives may further support businesses adopting solar energy.

4. Green Credentials:

Addressing customer concerns about climate change and environmental impact is crucial for businesses. Demonstrating a commitment to sustainable development and renewable energy enhances brand loyalty. Consumer preferences increasingly align with socially responsible and environmentally conscious choices. Many successful corporations, such as Apple, Google, Amazon, Walmart, and Target, have embraced solar initiatives, reflecting the growing importance of green energy.

5. Quick Payback Period:

The combination of power bill savings, MACRS depreciation tax, and subsidies contributes to a strong return on investment for commercial solar projects. Considering solar panels longevity (typically 25 to 30 years), the payback period is relatively short, making it a financially viable and sustainable investment.

6. Electric Bill Offset:

A commercial solar power system can completely offset a company’s electricity costs. Grid-tied systems allow businesses to export excess power to the grid and import power when needed, facilitating a complete offset of energy expenditure. This provides protection against future utility rate increases and offers the opportunity to earn the total retail rate for exported power through net metering.

Complete electric bill offset ensures resilience against utility rate fluctuations, and the surplus energy generated results in positive cash flow. Whether through ownership or financing, businesses that transition to solar often experience reduced costs or, in the case of ownership, even free electricity once the initial investment is recouped.

Solar Earth Inc Designs and Installs Commercial Solar Systems

We hope we have cleared some of your confusion, and now you can get started with your commercial solar project. Going solar won\’t only benefit your company, but it also contributes to reducing your carbon footprint and the production of clean energy. You\’ll be surprised how your consumers react to this initiative, resulting in increased brand loyalty, which is a positive sign for your business.

If you want to step forward and go green, contact Solar Earth Inc. to get detailed information about the expenses and setup process of a commercial solar power system.

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