It doesn’t matter what size of business you run, you’re always looking for ways to increase profits and reduce expenses. When it comes to using energy, you’re always going to have to be paying for electricity because you need lights, computers, and any number of other electronics to keep your business moving. Many businesses have found that making the switch to solar has paid off in both incentives and savings in utility bills. You too can enjoy incentives for your business by switching to solar energy. If you’re not familiar with custom solar installations and how your company can benefit, our team at Star Enrg has put together this guide to help break some of them down for you.
Federal investment tax credit (ITC)
Among the available tax credits and incentives available for switching to solar energy, the federal investment tax credit is the largest and most commonly used of the group. The ITC gives your business back 26% of the costs accrued when paying for your solar panels and installation. This means that if you pay $30,000 for panels and labor, you can claim $7,800 on your next year’s taxes. This is a significant break and enough of a reason for many people to switch.
Rebates are a great way to save money on many large purchases that you have to make for your business. These are commonly available for a limited time with appliances and home improvement fixtures. The same applies to solar installations. You can pay for your solar panels and installation then submit proof of purchase and documentation to get cash back from the manufacturer to help offset some of your out-of-pocket costs.
Accelerated and bonus depreciation
Small business owners are eligible to write off the depreciation of assets as business expenses to help ease some of their tax burdens. Solar panels are a qualified asset when filing for 4562 with your taxes. You can claim cost recovery for up to five years and reduce the overall cost of your solar system by up to 30%.
Paying for a custom solar installation is not a small expense. Not all businesses have enough working capital to pay for solar panels upfront. Instead, you can apply for loans offered by the state or your utility company to finance the cost of changing over to solar energy. However, these can come and go so check availability when you start shopping around for a company to install your solar energy system.
It’s not uncommon to have a solar energy system that takes in enough energy that you have an excess of power. This means that your solar panels have converted sunlight into more energy than your building has used that day. You can sell the excess energy back to your utility company for credit on your utility bill. The state of Delaware runs this incentive to encourage home and business owners to switch to solar so they can produce more clean solar energy.
Performance-based incentives (PBIs)
Performance-based incentives work similarly to net metering as you’re rewarded for producing electricity. In fact, PBIs can be put in place in lieu of or along with net metering policies. You’ll be paid per kilowatt-hour of electricity produced rather than what’s in excess of what your building uses.
Schedule an assessment
Get started making the switch to solar energy today by getting in touch with our team at Star Enrg. We offer custom solar installations to help you produce the maximum amount of energy for your facility. This will help to increase energy efficiency and make you money in the process. Give us a call at 302-397-8917 or send a message to schedule your assessment.