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Solar power has grown significantly over the past two decades, driven in part by a desire to increase sustainability and take advantage of generous tax incentives that support business owners' bottom lines. Just as you can install solar panels on the roof of your home, you can also install commercial solar panels on business, nonprofit, and government facilities to generate electricity.
What is commercial solar power?
Although modern solar power has been around for decades, many commercial businesses still rely on electricity. But by switching to solar power, businesses, government agencies, and non-profit organizations can not only save money, but also significantly reduce their carbon footprint.
Similar to residential solar power options, commercial solar panels harness the power of the sun and convert this renewable energy source into electricity to power office buildings, factories, warehouses, and more.
Where can commercial solar panels be installed?
Residential solar installations are most often installed on residential rooftops, as this provides the largest surface area for panels to capture sunlight. Rooftop installations are also a good option for commercial solar installations, especially since office buildings, warehouses, factories, and other similar spaces often have ideal, spacious, flat roofs.
However, rooftops aren't the only place you can put commercial solar panels. For example, you can also turn a parking lot into a solar carport, which is essentially an outdoor garage with a roof that has solar panels on it. Other options include ground-mounted solar arrays, some of which can tilt or rise at certain times of the day to capture the optimal amount of sunlight.
How much do commercial solar panels cost?
A commercial solar panel installation can cost anywhere from $100,000 for a small business to over $1 million for a large building. It stands to reason that the larger a company is, both in terms of building size and energy needs, the more solar panels they will need to produce that electricity.
Factors that Affect the Cost of Commercial Solar Panels
As with any construction or renovation project, pricing depends on a variety of factors, and because commercial and industrial spaces vary widely in size, the range of prices is even wider.
If your commercial property requires the installation of additional solar panels, the cost will be higher and the installation time will be longer. Costs may also be higher if the structure of the building makes it difficult to install solar on your commercial property.
Keep in mind that tax incentives can also reduce the cost of a commercial solar installation, not to mention lower energy costs overall. Savings also vary depending on the amount of energy produced and the energy your business needs. In some cases, your business may be able to sell excess energy that is produced by your commercial solar installation but not needed.
The best way to determine the actual cost of a commercial solar installation that will suit your organization’s needs is to get quotes from various commercial solar installers servicing your area.
How to Install Commercial Solar Panels
Commercial solar panels are typically installed on roofs using one of two methods: ballast rack or attached rack.
Ballasted racking uses heavy objects, such as cement blocks, to secure the panels to a flat roof, while attached racking allows you to attach the panels to a sloped roof using hardware that penetrates the roof.
While small-scale residential solar panels may be DIY-able, commercial solar panel installation is best left to professionals with the tools and training. Not only will incorrect installation reduce the power output of your solar panels, but they can also be dangerous if the panels are not properly secured.
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Commercial Solar Panel Discounts, Tax Credits and Other Incentives
The Solar Investment Tax Credit (ITC) is a federal initiative that encourages business owners to install solar panels on their commercial properties.
The tax credit was originally 30% of the total cost of a solar photovoltaic (PV) system installed in the current tax year. However, in December 2020, Congress passed an extension of the ITC, which will result in a lower tax credit for subsequent years. For system installations beginning in 2020 through 2022, the credit is 26%, dropping to 22% in 2023 and 10% from 2024 onwards.
If you're thinking about installing a commercial solar power system on your business property, it's a good idea to start the project as soon as possible. According to the U.S. Department of Energy, a solar power system installation project is considered to have “started” when installation work is significantly advanced or when 5% of the total cost has already been paid for work “essential” to the installation and services are provided within 3.5 months of payment.
Residential vs. Commercial Solar Panels
Solar panels, both residential and commercial, do the same thing: absorb sunlight and convert it into clean energy, but that's where the similarities probably end.
Some commercial buildings are so large that there are many different ways and places that panels can be installed. Commercial buildings require much more power than a typical home, so commercial panels are often larger and more powerful than residential panels.
The average residential solar panel has 60 or 72 cells, while commercial solar panels have 96 or more cells.
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Best Commercial Solar Companies
Solar power is still an emerging energy source. Some commercial contractors offer services in all 50 states, while others specialize in certain regions of the country. The types of options available will depend largely on where your commercial business is located.
According to Solar Power World's national rankings of solar contractors, the top 10 commercial solar companies by kilowatts installed in 2021 are:
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Frequently Asked Questions (FAQ)
How are commercial solar panels installed?
Commercial solar panels are typically installed using heavy weights (ballast racks) to secure them to flat roofs, or roof penetration fittings (attached racks) on sloped roofs. Given the size and nature of these installations, they require trained professionals to install.
How do you size a commercial solar power system?
Installing a commercial solar power system is complicated, but calculating how big a system you need isn't too difficult. To calculate, multiply your business's hourly energy demand by the number of peak solar hours in your area. Then divide that number by the wattage of your panels to determine the total wattage you'll need for your commercial solar power system.
How many solar panels do I need for commercial use?
Once you know how big your commercial solar system needs to be, divide the total wattage by the wattage of each individual panel. Depending on the size of the panels will determine how many panels you need.
Is there a difference between commercial and residential solar panels?
Commercial and residential solar panels are similar in that they both absorb sunlight and convert it into energy. However, like most commercial products and applications, they do everything on a larger scale than their residential counterparts. Commercial panels can be larger and have higher wattages than residential solar panels.