Are solar panels worth it for businesses?

July 18, 2022 by Admin

Sustainability in business has become increasingly popular.

It’s safe to say that renewable energy plays a big role, with many businesses opting to switch to a green energy tariff. Some businesses are looking to take that one step further and generate their own renewable energy with solar panels.

In this guide, we’ll discuss solar panels and whether they are worth it for your business. We’ll also answer some of the most frequently asked questions about solar energy.

 

What Are Solar Panels?

Solar panels, also known as PV panels or Photovoltaic panels are devices used to convert sunlight into electricity that can be used to power our homes and businesses. These panels are often installed in the rooms of properties or on the ground in ‘solar farms’.

In 2021, solar energy generated around 4% of the world’s electricity supply. Solar panels produce comparatively less electricity than other renewables such as wind (6.5%) and hydropower (15.2%). China currently produces the most solar energy, followed by the USA and India.

Here in the UK, the use of solar is low: we prefer to use wind power. Around only 4% of renewable energy comes from solar power.

Solar panels are made of layers of semi-conductive material, normally silicon. When light particles or ‘photons’ are absorbed by the panels an electric current is generated. This is then converted into usable energy which can power a business or a home.

 

How Do Solar Panels Work?

Solar panels are made of layers of semi-conductive material, normally silicon. When light particles or ‘photons’ are absorbed by the panels an electric current is generated. This is then converted into usable energy which can power a business or a home.

 

How Much Do Solar Panels Cost?

With the recent and significant advancements made in solar technology, the installation of panels has never been so affordable. Obviously, specific costs will depend on the number of panels you wish to install, where you would like them to be positioned, and the brand and type you’d prefer.

A typical SMB will need a solar system capable of generating between 5 and 9 kW and will cost somewhere in the region of £8,000-£14,000. For larger commercial sites that cover many more square metres, higher output is needed meaning only systems producing between 25kW and 200kW will suffice.

The average cost of different solar system sizes:

Size of Solar System (Power Output)	Average Cost
5-9kW:	£8,000-£14,000
10kW:	£15,000-£16,500
25kW:	£40,000-£45,000
50kW:	£70,000-£75,000

 

Do Solar Panels Save Money for Businesses?

According to Money Supermarket, the average cost of producing commercial solar energy is around 5p per kWh. In comparison, it’s estimated that businesses pay anywhere between 11p and 15p for the same amount of energy from electricity suppliers.

Whilst you also have to factor in the initial cost of solar panels, it’s clear that there can be great financial benefits for businesses in the form of reducing electricity bills. And at a time when prices are continuing to rise, businesses should consider all options available to help them save money and increase energy independence.

 

Are Solar Panels Worth It for Businesses?

In order to acquire an attractive ROI, the installation of solar panels must be viewed as a long-term commitment. Though it can take several years, an appropriately sized and well-maintained solar system will become cost-neutral.

As an example, a £5,000 – £10,000 solar Photovoltaic system will take approximately six to 10 years before the savings exceed initial investment. After this time, all expenditure represents ROI. Moreover, via The Smart Export Guarantee (SEG), unused energy can be sold back into the national grid to generate additional revenue streams.

 

Do Solar Panels Need to Face South?

Solar panels work best when facing true south, as this often has the most sun exposure throughout the day.  Solar panels still work however if they do not face true south. Roofs that face both the south-west and south-east are still considered to be highly efficient. If you have a due east- or west-facing roof, your solar panels will still work but only at about 86% efficiency when compared to those installed on a south-facing property.

 

Do Solar Panels Work in Cloudy Weather?

There’s a misconception that you need constant sunshine for solar panels to work. Obviously, they function most efficiently when the sun is shining but they will still work in all daylight conditions. Electricity will still be produced on cloudy days and during the winter but only around 10-25% of the normal rate.

 

What Are the Environmental benefits of solar energy?

 

Use less water

We all know that water is a precious resource. Yet thousands of litres are wasted on electricity production every year, used to cool generators. Solar panels do not require any water to produce electricity, helping to conserve one of our most vital natural resources.

Reduce carbon emissions

Much of our current electricity comes from fossil fuels, which are burnt to release their energy. Yet this also releases carbon dioxide and other greenhouse gases into the atmosphere, contributing to air pollution, acid rain and climate change.

End dependency on fossil fuels

Fossil fuels like gas, coal and oil are formed from animal and plant remains over thousands of years. Eventually, we will run out of these fuels, especially if we continue to consume them at the rate we are now. We therefore need to start finding alternative ways to power our homes and businesses, with renewables leading the charge.

Fight against climate change

Carbon dioxide and greenhouse gases are contributing to climate change. And human activity is one of the leading causes of these emissions. If we are to prevent global temperatures from increasing to dangerous levels, we need to rapidly reduce our consumption of fossil fuels.

Help reach net-zero

Reaching net-zero emissions, so balancing the emissions we release with those that are taken in, is considered one of the best waits to stop rising temperatures. Solar energy helps us generate electricity without emissions, helping us meet energy demand whilst reaching a net-zero target.

 

What are the business benefits of solar panels?

It’s no secret that solar panels can be a big investment for your business. But they do bring benefits including:

Lowering electricity costs

Installing solar panels across your business can help to reduce your electricity bills by up to 40%, helping you save money on your utilities.

Reducing Your Carbon Footprint

Solar panels convert sunlight into renewable energy for your business. Powering your business with renewable energy over fossil fuels will help to reduce your carbon footprint.

Minimising Reliance on National Grid

With solar panels generating free, renewable energy on-site, your business can reduce its reliance on energy from the national grid and be more self-sustaining.

Improving Corporate Social Responsibility (CSR)

Sustainability is a big part of corporate social responsibility. Ensure your business is doing its bit for the planet and community by installing solar panels.

 

Interested in Exploring Solar Power? Contact Tariff.com Today!

If your business is considering installing solar panels, Tariff.com should be your first port of call. Our friendly and experienced team are here to support you.

Free Solar Review

Tariff.com can offer professional guidance on your solar panel installation. We’ll conduct a free solar review of your business and calculate the best PV system for your energy needs.

 

Detailed Solar Report

After our review, we’ll present you with information such as cost, carbon saving, potential grants and payback periods in a detailed solar report.

 

Financial and Grant Advice

At Tariff.com, we understand that solar panels are a big investment for your business. That’s why we’ll look at funding options available, including CAPEX projects, finance funding and power purchase agreements to make solar panels as financially accessible as possible.