With the average Commercial and Industrial energy bill being one of the highest in the United States, switching to solar power can be highly beneficial to your bottom line.
We have put together seven reasons why installing a solar system for your business can help you save on your operating costs.
1. Investment Tax Credit (ITC): Upon installation of your solar system, your business can take advantage of the Federal Investment Tax Credit (ITC). The credit entitles you to a dollar-for-dollar tax credit on the gross cost of the solar system. This means that if you paid $1,000,000 for your solar system, you currently qualify for a $260,000 tax credit. However, this tax credit is set to begin dropping after 2022. The ITC will be reduced to 22% in 2023 and will then drop to 10% in 2024 and after.
2. Modified Accelerated Cost-Recovery System (MACRS): The IRS defines depreciation as an “income tax deduction that allows a taxpayer to recover the cost or other basis of certain property, including solar. The benefit from MACRS comes from reducing the amount you spend on your taxes each year. MACRS allows the business to recover costs over time, either all in the first year (Bonus Depreciation) or spread out over 5 years (Standard).
3. Decreased Operating Costs: Once your system is paid off, your business’ energy operating expenses will immediately decrease. The exact amount of savings varies between projects.
4. Increase Property Value: Studies have found that solar systems can raise the value of your property.
5. Avoid Changing Utility Rates: The electricity rate for commercial properties in Arizona has increased by more than 40% from 1999 to 2018. By installing solar, you can shield your business by having a fixed rate for the electricity you produce which allows you to better plan your future energy costs with steadily rising utility rates.
6. Improve Your Image: Another benefit of installing a solar system on your business property is that you can improve your brand and show your commitment to clean energy. Solar energy systems show customers and employees that your company cares about the environment. This will create a more positive impression of your business and will also make a very public statement.
To ensure that your solar system is value-engineered and professionally installed call (480) 725-6518.