Considering solar? Here is why you should be doing it now
Every month, all but a handful of businesses who are off the grid pay environmental charges on their bill. These are charges levied by Federal, state and territory governments.
Most businesses fail to claim back what they are already paying for. Those levies exist to fund solar and energy efficiency subsidies. Five years ago, the return on investment for these technologies was a challenge. Low energy prices (lower than now) as well as a higher cost for the technology made many take a wait and see approach.
These subsides have been available for quite a few years now. The purpose of them was to incentivise business as well as residential adoption of solar. It has delivered on its promise thus far. You do not need to look far to see solar panels on the roofs of many homes and businesses.
One of the benefits it has brought is a strong solar industry and lower technology prices. There has never been a better time to consider solar for business if you have not already invested in it. It may even be a last chance to claim back some of the levies you have already paid.
Many are arguing that with higher energy prices and lower costs of solar – the subsidies do not matter. But in business every dollar counts and you should be considering it. Here is why now is the time.
Even without subsidies the savings are attractive
Take the subsidies away and the return on investment for solar has never been better. The price per kW for a solar system now is around $1100. Five years ago it was 3x as much.
Combine this with higher energy prices and return on investment can be as little as 2 years.
Electricity prices are not likely to go down
This is regardless of which government is in power in the foreseeable future. In the modern era, more taxes and levies are the way either side fund initiatives. Without a national strategy to deliver the power the nation needs, supply is at a premium. And demand is increasing with a growing population.
The energy prices we are paying today are the new norm. And, they are likely to be higher into the future.
You have already paid for the subsidy you will receive back
As environmental charges are on your electricity bill, you have already contributed to the subsidy. There is no reason why you should not be getting your share back.
If you can take advantage of it, there should be nothing stopping you doing it now.
Even if you are leasing your business premises, solar still makes sense
Even in a leased business, if you use a reasonable amount of energy it pays off. If you are going to stay in the same location for the next 3 years it is worth considering. Assume electricity prices stay the same (and it is likely they will rise). At worst you will break even. Any increase in electricity prices will provide a future benefit. Further, you’ve added to the landlord’s asset so you may be able to negotiate a contribution of capital or alternatively a ‘rent holiday’.
We did it and it has worked well for us
As a business who helps others reduce their operating costs – we like to eat our own dog food. Three years ago we started on the journey ourselves. It was a considerable investment. But it delivered reduced energy cost and helps us reduce our environmental impact.
We are not large users of energy by any means. Yet, the return on investment is already delivered. Our energy bills are negligible. You can read more about our story here.
What are you waiting for?
Procrastination is the thief of saving. We have seen it in our careers and see it with businesses today.
Prices per kW are better than they were in the past
If you looked at solar five years ago it is time to look again. The price per kW for a solar system now is around $1000. Five years ago it was 3x as much. This combined with the higher electricity prices per kW improve return on investment.
Electricity prices are not likely to go down
This is regardless of which government is in power in the foreseeable future. In the modern era, more taxes and levies are the way either side fund initiatives. Without a national strategy to deliver the power the nation needs, supply is at a premium. And demand is increasing with a growing population.
Political situations will always change
Regardless of who is in power, the promises they made before gaining power are unlikely to come true. Waiting for ‘potential’ greater future savings is foregoing savings.
This type of behaviour stuns us the most. I won’t save now as I may be able to save more later. In what version of reality does this make sense.
2019 is the year to make a move.
The opportunity for subsidies is going away. This may change but it may not. If you have considered it in the past, take another look at ROI. Talk to someone who can help and has been on the journey. We have helped many businesses from aged care through to manufacturing on their journey. All have delivered significant energy cost benefits.
