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Steps to Going Solar for Commercial Customers

Businesses make the decision to add solar panels to their facilities for a variety of reasons. A customer-owned solar system will generate electricity behind the meter and reduce the amount of energy supplied by your local utility. There are many benefits to going solar, for you and your business.

  • First, solar may lower your kWh energy costs and reduce your energy consumption from the grid.
  • Second, solar will reduce your carbon footprint, help meet sustainability goals, and strengthen environmental and corporate social responsibility credentials by offsetting grid consumption with onsite renewable energy.
  • Third, solar can help reduce monthly energy bills, thereby allowing a business to invest more money into your organization.
  • Finally, solar will help with financial planning by providing more budget stability through predictable electricity costs and accurate forecasting of operating expenses.

If a business elects to combine a photovoltaic array with onsite battery storage units, the system may help reduce your kilowatt (kW) demand charges and further reduce dependence on energy provided through the grid. This requires storing energy in the batteries and using the stored energy during peak pricing periods. Customers can charge batteries during off peak time periods and then consume the energy during peak or super peak time periods.

NEM 3.0 Update

The California Public Utilities Commission (CPUC) issued a decision on Dec. 15, 2022, that modernizes the Net Energy Metering (NEM) solar tariff to promote grid reliability, incentivizes solar and battery storage, and controls electricity costs for all Californians. The decision has no impact on existing rooftop solar customers and maintains their current compensation rates. Existing solar customers will continue to remain on their current Net Energy Metering (NEM) tariff for 20 years after their system is connected to the electric grid.

According to a CPUC analysis, the following findings were reported. If you install rooftop solar after the new tariff goes into effect on April 15, 2023, you should be able to fully pay off your system in nine years or less based on your ongoing electricity bill savings. Under the new tariff, the average residential solar customer will save approximately $100 a month on electricity bills. Solar customers will also benefit from an electricity rate that will make it more affordable to add additional electrical appliances (such as heat pump water heaters) and take advantage of at-home electric vehicle charging.

There is also $630 million in State funding of upfront incentives available for low-income customers installing solar plus battery storage. These upfront incentives will further decrease the payback for customers installing a solar system with battery storage.

Learn more about NEM 3.0 from the California Public Utilities Commission – Energy Division

CPUC NEM 3.0 Press Release

CPUC Frequently Asked Questions

CPUC NEM 3.0 Fact Sheet

The Pros and Cons of Installing Solar

Installing solar can appear to the be the best solution for many companies. However, before any decisions are made it is imperative that all of the pros and cons are identified and understood. Here are some to consider.

Pros of Solar Energy Cons of Solar Energy
Helps to reduce total energy bill
Higher upfront costs
Environmentally-friendly
The required square footage can be quite large
Fairly low maintenance
Not a consistent energy source
May increase property value
Not a good solution if a business is not going to stay in location for a number of years
Solar combined with batteries are an even more impactful solution
Requires a clear line of sight to the sun

There are a number of things to consider before going solar:

  1. Your Energy Needs
    The very first thing you should consider is the energy needs of your business. How much are you spending on utilities each month? Each year? It is best to create a 24 month energy report. This will allow the decision makers to fully understand how much energy is used. This includes the actual energy (kWh) consumed and peak energy demand (kW).
  2. Evaluate facility roof and site acreage
    There are a number of things to consider regarding the facility and surrounding property, as it relates to a solar system. Is the roof large enough to hold a system that is large enough to warrant the investment? Is a ground mount system more desirable and is there a suitable location? Is there too much shade in the proposed location? Does the building face the proper orientation, not a concern for flat roof facilities.If a ground mount system is being considered, will it be safe from vandalism or theft? If a roof system is selected, will the existing roof support the additional weight?
  3. Your business’ impact on the environment
    If yours if the type of business that requires significant amounts of energy and has any type of output on the environment, commercial solar would be an excellent way to help negate some of those effects and improve your carbon footprint. This would not only benefit your company, but also the community in which you operate.
  1. City building regulations
    It is important to understand the requirements of your city and/or county, as it relates to the installation of solar panels. Always check with the local permits department to get a clear understanding of any requirements. Additionally, if your facility is located within a business complex that has a set of CC&R’s always verify the rules, as it relates to the installation of solar panels.
  2. The tax credits in your state
    Solar Energy Industries Association (SEIA) is a great resource for a number of solar related items. The SEIA website will give you up to the date tax information. Before you complete your financial review, it is imperative that a thorough understanding of the federal and state tax credits and depreciation rules is critical to determining the cost effectiveness of all solar and battery projects.
  3. The maintenance of a commercial solar system
    Most solar panel manufacturers provide at a minimum, a 25 warranty on solar panels and at least a 10 year warranty on the inverters. The warranty on solar panels varies in the terms. Most warranties state that the panels will produce, a minimum amount of kWh per year. This number is greatly reduced from the original production projections.

    While solar systems are relatively low-maintenance, it’s still important to be on the lookout for any problems that may arise or external factors such as weathering or wildlife that could cause damage to your panels. You can clean and troubleshoot yourself if you’re prepared, but we recommend hiring a professional solar O&M company to effectively service your system.
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