Solar Panels for Business: Benefits and Costs
Solar PV panels enable thousands of households across the UK to generate their own free electricity, lower their energy bills, earn income by selling electricity to the grid, and reduce their impact on the environment, but it’s not just homeowners who can benefit from solar panels.
If you own a business and your premises are suitable (i.e. your roof can accommodate solar panels), installing solar could be a great move for your future. Here we explore the benefits and costs of solar panels for business in the UK.
Commercial vs Solar Panels for Business
It’s important to note that there is a slight difference in terminology when it comes to solar panel installations on non-domestic buildings. ‘Commercial’ solar tends to refer to large solar arrays such as those installed on agricultural buildings, industrial warehouses, factories, schools, hospitals or manufacturing plants.
‘Solar panels for businesses’ are usually most associated with small and medium sized businesses (SMEs) which operate from office premises. Most small and medium sized businesses would therefore usually require a solar panel system which would be similar to a domestic system in terms of size and return on investment.
Why invest in solar panels for your business?
Installing solar panels is an option for any size of business in any sector which would like to cut costs, bring in extra revenue, reduce reliance on rising energy prices and minimise its carbon footprint. The more energy you need to use in your operation, the more your business and the planet will benefit from installing solar panels.
Save money through lower energy costs
The electricity generated by solar panels is free energy. For every kWh of energy the panels generated, that’s one kWh less you’ll need to buy from a supplier. When you consider that the average cost per kWh of electricity is approximately 14p, it’s easy to see how using free electricity from solar panels could reduce your overheads.
Less reliance on the grid and rising energy prices
Energy prices have been increasing gradually for years and this is expected to continue to rise as fossil fuels (which are traditionally used to generate electricity) become harder to source. By generating your own electricity from solar panels you can reduce your reliance on the National Grid and the fluctuating prices. This should make budgeting and forecasting much more straightforward.
Businesses can see greater ROI
The potential issue for homeowners with solar panels is that electricity is only being generated during daylight. If they are not generally at home during the day to use it, most of their solar electricity will go unused and be exported to the grid. Most businesses, on the other hand, are using electricity during the day and not at night and should be able to achieve higher savings as a result.
However, even if your business does operate during the evenings and/or at night, you can still put your solar energy to use. Many homeowners and businesses install a solar storage battery alongside the solar panels you which enables them to store any unused electricity for another time, i.e. outside of daylight hours when the panels are not generating.
Earn money with the Smart Export Guarantee
If you don’t use your solar electricity and choose not to store it in a battery, you can generate yet more income through your solar panels via the Smart Export Guarantee. The Smart Export Guarantee (SEG) scheme is open to homeowners and businesses who are generating their own electricity through renewable technology.
Any electricity you don’t use will be exported (sold) to an energy supplier. An export meter will track how much you have exported. The exact price the supplier will pay per kWh will depend on the energy supplier you choose as each offers a different tariff with varying terms and conditions. The supplier can then sell on the electricity at the higher retail rate. The average tariff is approximately 3.5-4p per kWh.
Reduce your business’ carbon footprint
Using electricity which has been generated via traditional methods, i.e. burning fossil fuels, means you are indirectly adding more carbon emissions to our planet’s atmosphere. If you reduce your reliance on the National Grid in favour of using renewable solar power, you can reduce your business’ carbon footprint significantly and help in the fight against global warming.
Improve your public image
Consumers are more aware than ever before about the impact we are having on the planet and will often consider a business’ sustainability and level of social responsibility before choosing to spend their money with them. Installing solar panels will show that your business is environmentally conscious which could result in an improved public image and even increased revenue.
How much will solar panels cost your business?
It is cheaper than ever before to install solar panels because technology has made huge leaps forward in production in recent years and the market is more competitive. The exact cost of solar panels for your business will be impacted by how many solar panels you need, what type and brand of solar panels you need and where they are being installed.
On average, a small to medium sized business will require a system with an output of 5-9 kW which will cost between £8,000-£14,000. A commercial installation which covers a larger space could need a 25kW-200kW system.
|Size of Solar System (Power Output)||Average Cost|
If you’re interested in a smaller system or solar panels for a home, take a look at How Much Do Solar Panels Cost?
Some solar companies will offer finance deals to enable you to spread the cost of the installation to avoid a large payment and help you to manage your business’ cash flow. For commercial installations, there are some arrangements which enable you to install solar panels with no upfront cost but you would then pay the solar panel funder for the electricity at a reduced rate. This means you get free solar panels and cheaper energy.
It’s also important to factor in Smart Export Guarantee earnings in your costs as these payments will help to recoup at least some of your initial outlay.
Get solar panel quotes for your business
The cost of installing solar panels for your business will vary depending on several factors including which company you choose for the supply and installation. To find the most competitive price, we highly recommend comparing quotes from multiple solar installers.
However, getting multiple quotes can take a while hard which is why Solar Guide is here to help. Simply take a few moments to go through our quick online form and we’ll match your needs with up to 3 solar installers based in your area.
Once you have the quotes then you’re free to compare them and be confident that you’re not paying a penny more than you should be.