Are commercial solar panels worth it?

If you’re looking to save money on your business’s utility bill or improve your carbon footprint, you may be considering switching to solar. Solar panel systems will not be an option for every commercial business, and the high installation costs can be intimidating. However, between financing and tax credits, the price can be mitigated, making the benefits of commercial solar energy all the more helpful to your business. 

This article will help you determine if a commercial solar panel system is the right choice for your company.

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, Are commercial solar panels worth it?

Commercial solar panel installation explained

What is commercial solar? How does it work?

Commercial solar is very closely related to residential solar, as both use panels to convert sunlight into electrical energy. However, commercial solar is somewhat more complex because the panels and converters need to meet a higher demand, since businesses typically use more power than a home. 

Energy bills can represent as much as 30% of the cost of running a business. This means that solar panels can be a worthwhile investment. In fact, the savings on electrical bills mean that panels are likely to pay for themselves within 3-5 years. Furthermore, this is true whether the company they are powering is in a commercial, industrial, or agricultural industry. 

What is the commercial solar installation process? How long does it take?

Installing a commercial solar system typically takes at least a few months, but it may be a process that lasts up to a year. This is because there are different permit requirements and local regulations for commercial businesses than for residences, which impacts the timeline. Furthermore, commercial solar systems tend to be larger and more involved because the energy needs are higher than for homes. 

What are the primary benefits of commercial solar? How much can my business save?

Commercial solar systems have numerous benefits for your business. They reduce your greenhouse gas emissions, which directly benefits the environment. They also help to combat climate change. This is useful because having an eco-friendly reputation can help your company in public perception. 

Furthermore, a commercial solar system offers the potential for dramatic savings. Electricity bills cost the average commercial property owner around $2,000 per month if you switch to solar power. After installing rooftop solar, the monthly price drops to around $500. That is a 75% reduction in energy costs! If you install a battery system, there is a higher initial cost, but your long-term savings could be even higher, because you will be able to save any excess energy for nights and overcast days. 

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, Are commercial solar panels worth it?

What are the pros and cons of commercial solar panels?


  1. They will save you lots of money in the long run.
    The upfront costs of installing commercial solar panels might be off putting, but the potential for savings is exponentially higher. Energy bills can be reduced by as much as 75% by implementing solar panels. Furthermore, there are tax credits that help alleviate the installation costs, and if you produce an excess, you can even sell the extra energy to make a profit.


  2. They’re environmentally-friendly.
    Powering your business with solar panels will reduce your company’s carbon footprint because you will not create CO2 emissions with your electrical needs. Furthermore, solar panel components are often recyclable. So relying on solar energy is not only better for your business, but also is better for the planet. 

They add value to your company.
If you ever sell your business, having solar panels already installed will increase its worth. This is because the new owner is able to immediately reap the benefits without having to spend time or money in the installation process.  Furthermore, the environmental benefits can help you attract more customers and employees, as many consumers prefer to shop green and workers might not wish to work for a company that is not concerned with their environmental impact.


  1. Installation times can be lengthy.
    While solar panels used to power homes can typically be up and running within a few weeks, commercial projects take a lot longer to be fully installed. The timeline for the process can range from several months to as long as a year.

  2. They aren’t an option for everyone.
    Installing solar panels on commercial buildings need certain conditions to be met. For instance, with roof-mounted systems, the slope can affect whether or not a solar system is an option. There are increased costs with steep roofs and there may be issues with drainage on ones that are flat. Ground-mounted systems are a good alternative, but this only works if you have enough land for them. Furthermore, the surroundings will affect the efficiency of your solar panels—so if you are bordered by tall trees or buildings, there may be too much shade for them to be worthwhile.


  3. The process can be expensive.
    Solar panels are not cheap to install, and commercial systems have added complexity which raises the cost. The overall price of commercial solar panel installation is going to vary quite a bit from business to business, because companies differ in size and will have different electrical needs. Additionally, there may be further costs associated with permits depending on your area. Fortunately, there are tax credits that can help offset the price and the savings mean that over time the panels will pay for themselves.

Since commercial solar systems have both positives and negatives, you’ll need to think carefully about whether they are the right choice for your business. However, with time, the benefits only increase, so if you choose to switch to solar you are unlikely to regret it. 

, Are commercial solar panels worth it?

How to get commercial solar installed for your business

The first step to switching to solar is to reach out a highly-rated commercial solar panel installer like SEM Power for a free solar installation quote. We’ll get back to you within 1 business day and help you take it from there. 

What kind of tax incentives and utility credits are available to commercial solar system owners?

The federal government has implemented a Renewable Energy Systems Program as an incentive for energy independence. This program is part of the Rural Energy for America Program; providing guaranteed loan financing and grant funding to agricultural producers and small businesses that invest in renewable infrastructure ground mount solar panel systems and commercial energy storage.

If price is a concern, the good news is that despite high installation costs, there are solar tax credits and utility credits that can make implementing a commercial solar system more financially viable. 

For instance, with the Solar Investment Tax Credit, businesses can be eligible for a tax credit worth 26% of the cost of their solar system. This means that if the gross price of your commercial solar system is $100,000, then the tax credit would be worth $26,000. There may be additional tax credits that are available to you depending on your state and local area as well. 

The federal Modified Cost Recovery System (MACRS), is a depreciation system that allows businesses to recover investments in certain property through deductions. Qualifying commercial solar energy equipment is eligible for five years of tax credits.

Furthermore, if you produce more electricity than you consume, it is possible to earn credits from your utility company. This means that investing in a commercial solar system can actually help you make a profit. 

What about solar energy for small businesses?

Small businesses might be discouraged by the high installation costs of solar panel systems. The upfront fees might be too much for this type of company, as compared to a larger one, but the good news is that the long term benefits can be even more impactful for these small businesses. 

  • Small businesses may have less electrical needs, so with the right solar system, they may be even more likely to produce an excess of energy. This means that not only will their utility bills decrease, they might be able to sell the electricity and earn a profit
  • Reputation is everything to small businesses which often live off of word of mouth and rely on their loyal customer base. More and more consumers are concerned with supporting companies that care about the environment and have a lower carbon footprint, so it can help encourage new customers and sales to invest in sustainable practices.
, Are commercial solar panels worth it?
, Are commercial solar panels worth it?

How much do commercial solar panels cost?

The initial price of installing a commercial solar panel system can be discouraging. Solar is generally expensive, and because commercial systems tend to be more complex and have higher output needs, the installation costs are even higher for businesses than for residences.

The cost for most businesses to install solar panels ranges from $2 – $3 per watt. However, there are tax credits that can help to reduce this financial burden. 

The good news is that there are also financing Options. Solar and Battery Energy storage financing solutions exist for every budget and organization type. No matter the size of your project, SEM Power has you covered with our extensive solar financing solutions and lending partners.

Additionally, for companies interested in owning a solar system, a cash purchase has a high return on investment and allows the business to take advantage of the Federal Investment Tax Credit. Capital purchases offer the greatest advantage in all tax incentives. Qualifying companies’ systems can be purchased at nearly a 60% reduction in cost; making an investment in solar that’s hard to pass up.

Can solar panels be installed in commercial buildings?

Solar panels are often an option for commercial buildings, however, this is not always the case. 

Numerous factors affect the viability of solar as a possible energy source for your business. For instance, the slope of your roof may preclude you from roof-mounted panels, if it is too high. However, flat roofs may be problematic as well, because if there is no incline, then drainage can be an issue. 

The surroundings will impact how much energy any solar panels can produce. Too much shade that is caused by tall trees or buildings may mean that your panels cannot generate enough energy to be cost-effective. 

Furthermore, commercial buildings are often subject to more regulations and permit requirements than residences. This means that you will need to investigate what the rules are for your specific area. 

Check out our recent commercial solar installations

Babcock Ranch Market Cafe

Power Specs:
55 305 w panels.
16.7 kW Total Output

, Are commercial solar panels worth it?

Planet Fitness – St Petersburg FL

Power Specs:
176.80 kW
SolarEdge inverters
Canadian Solar panels

, Are commercial solar panels worth it?

Custom Mobility – Largo, FL

Power Specs:
251.52  kW commercial solar installation
524 Hanwha Q Cell 480 w modules
262 SolarEdge P960 optimizers
2 SolarEdge P960 inverters

, Are commercial solar panels worth it?

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