Solar Panels?

Does it make sense to have solar panels installed on commercial buildings?

  • In urban areas it looks like the emphasis on installation of solar panels is to get them onto residential buildings and to chase after incentives for their installation.  What about commercial buildings?  Whether we consider strip malls, warehouses or manufacturing buildings, there's a lot of energy beating down on these roofs that could be put to good use.  Is there an economically wise way to get solar panels onto commercial buildings? I'd also like to know, would the presence of solar panels add to the life of a roof, or would they catch the wind and weather, need their own maintenance, and take away from the life of a roof?  Is there an incentive for panels to be used on commercial buildings in protecting the property itself? I also have a concern for where the collected energy should go.  From what I can tell, at a residence the energy produced is used to "run the meter backwards" (a figure of speech).  At a commercial location, tenants may be responsible for their own electric meters, so how would solar panels earn anything for the building owner? Finally, are there companies that would shoulder the cost of installation and maintenance, and share revenue as time went by, rather than having to fund purchase, installation and maintenance and hope to figure out how to get revenue?

  • Answer:

    You should probably take a look at one of the largest company in solar energy, Sunedison. The company built its fortune by selling power to commercial buildings and taking care of building and operating solar plants on the rooftops of such buildings. Apart from LEED, most countries have developed more incentives for solar power. These incetives are directly linked to energy generation. Infact, in most countries, the traditional power generating companies/ utilities are obliged to buy some power from renewable energy companies. Let me make it more clear to you. Consider Company X puts up a solar plant at the top of a commercial complex. The company X pays rent to commercial complex for using the space. The commercial complex pays the Company X for selling it power. These rates are generally at par with normal grid or a little lower. On the other hand, the plant is still owned by Company X where it takes care of operational expenses and maintenance. Since the plant is owned by Compay X, the power generation benefits from govt and other agencies also go to them. The company X makes this a much more profitable proposition by doing this at a scale! Its off-course not as simple as it sounds but it works!

Manan Shah at Quora Visit the source

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Other answers

The points mentioned in the answer very well present the value proposition of installing a solar PV system on rooftops for commercial buildings. Putting solar panels on a rooftop ofcourse makes sense, irrespective of it being a commercial building, a residential apartment, a manufacturing facility or any other place that requires power for their day to day operation (well, what doesn't?). The reasons are pretty simple: 1) You save on your energy bill. 2) You avoid the effect of power cuts (common in a developing country like India) on your operations 3) You save on diesel, or any other back up system for that matter and hence save money 4) As a commercial company, you not only showcase yourself being using clean technology that adds to your CSR, but make an actual contribution towards sustainability. 5) You can claim accelerated depreciation (AD) on the project cost (leads to tax savings). In India, 100% (80% in first year, 20% in second year) AD can be claimed in two years. 6) Last but not the least, you invest in something useful and that is going to last for next 25 years! Coming to the part of "run the meter backwards"- the situation arises when you go for a grid-connected system instead of a system that stores energy that can be used later. It happens when the generation of your system exceeds the requirement at a particular point of time (a floor of the building in shut down and is no longer using any power on a day or a major energy consuming equipment is switched off for some time, for instance). In places where net metering is still to be implemented (India again, for ex.), a grid connected system, if not designed properly, may lead to power export to the grid "running the meter backwards" and adding to your electricity bill. In one of our recent projects, we worked out a solution to immediately detect the export of electricity and put it to use by storing in in a UPS system. Hope this helps!

Vivek Pandey

Solar panels for commercial buildings have the same kind of benefits as on residential buildings. What it means is that you ultimately save yourself money on bills and also decrease your dependence on the electrical grid. There is also a unique benefit for businesses as it shows your business patrons you are environmentally aware Solar panels don't necessarily add to the life of the roof, but they certainly add to the usefulness of it. They do require some maintenance, but if you have a look here - http://www.commercialsolarinstallations.com/commercial-solar-projects.htm - you can see a chart with the incentive schemes, although these change depending on the size of your solar array. If you have a battery system you can use the solar panels to charge it,  which can then be used when the solar panels are not producting  electricity or during power failures as opposed to just 'running the meter backwards'. In terms of finance schemes, there are many available. However it is advisable that you own the panels outright the make sure you have all the equipment 'in your own name' so to speak. See here for a typical example of available finance options - http://www.commercialsolarinstallations.com/commercial-solar-installation-finance.htm. They will typically offer Asset Finance and things like that. Overall, it's reasonable to say that commercial premises can benefit even more than residential properties in terms of the the size and productivity that is usually available for commercial solar arrays.

Jeffery Nevil

There exist tax incentives for installing solar panels for businesses. Additionally, owners or developers may install solar panels to work towards achieving some sort of LEED status to use in marketing their property. This is another incentive since tenants may be willing to pay a premium for LEED certified buildings. Another incentive is that solar panels will lower the operating expenses of the property by reducing the energy consumption. Keep in mind that "running the meter backwards" is not exactly what happens. When a residential unit produces surplus, the utility company issues an expiring credit, rather than a check, to the homeowner. In the end, the utility keeps its money no matter what because most likely, the credit expires at the end of the year. No one earns money from the electricity generated by solar panels. The only way building owners can "earn money" from the solar panel is by lowering operating expenses and increasing the rent.

Joseph Zhong

Do you think that taking control of one’s energy costs by adopting sustainable means should be termed senseless? If not, then installing http://www.solahaus.com.au/commercial/ on commercial buildings makes hell lot of sense. So, it is safe to say that there could never have been an idea as great as solar panels for business. It is like killing two birds with one stone. You save money by securing future energy generation for your business, and you save environment. Solar panels for the commercial sector have also been the viable option. They are efficient to generate free, green electricity to be used onsite, thereby lowering your energy demands from the grid and saving you hundreds and thousands on your energy bills. And by using this means of generating electricity, you work towards reducing your carbon footprints. It also could offset most of your business’ carbon emissions.

Robin Smith

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