If energy efficiency is something a business must do, then installing a thorough energy management system is just plain common sense.
All businesses rely on sound management to be successful and managing energy usage should be a fundamental part of that approach. Despite that fundamental truth, energy management is often neglected, even though it is a crucial component of reducing costs.
There’s nothing complicated about it, in simple terms it’s the systematic use of management techniques, processes and tools to improve the energy performance of an organization - basic housekeeping, you might say.
For every dollar saved on energy costs, most U.S. businesses would have to make $10 dollars worth of sales to generate the same $1 dollar of profit, according to the Department of Energy
If poor energy management is wasting a business $1,000 dollars – whether that’s because of being ignorant about where you use it or even a bad business buying decision – that business would have to make $10,000 worth of sales to make back an equivalent $1,000 in profit.
There are many reasons why property owners go solar, but improving the environment and cutting energy costs is most common. Many people are aware that solar is a great efficiency upgrade and are eager to reduce their carbon footprint while also improving property value.
Whether your motivations for going solar are economic, environmental, or personal, this sizable list of solar power benefits will have something for everyone. Here are a few reasons why solar energy is good for your home or business, and more popular than ever in the United States.
Whether you’re a homeowner, business, or nonprofit, electricity costs can make up a large portion of your monthly expenses. With a solar panel system, you’ll generate free power for your system’s entire 25-year plus lifecycle. Even if your unable to produce 100 percent of the energy you require, solar will reduce your utility bills and still save a lot of money.
They’re one of the best ways to invest, with returns rivaling those of more traditional investments like stocks and bonds. Thanks to substantial electricity bill savings, the average American homeowner pays off their solar panel system in seven to eight years and sees an ROI (Return On Investment) of 20 percent or more.
One of the most clear-cut benefits of solar panels is the ability to hedge utility prices. In the past ten years, residential electricity prices have gone up by an average of three percent annually. By investing in a solar energy system now, you can fix your electricity rate and protect against unpredictable increases in electricity costs. If you’re a business or homeowner with fluctuating cash flow, going solar also helps you better forecast and manage your expenses.
Multiple studies have found that homes equipped with solar energy systems have higher property values and sell more quickly than non-solar homes. Appraisers are increasingly taking solar installations into consideration as they value homes at the time of a sale, and as homebuyers become more educated about solar, demand for properties equipped with solar panel systems will continue to grow.
Energy storage technology has been around for decades, but batteries used in a home with solar systems are relatively new to the market. While batteries can offer a significant economic benefit for homeowners in certain situations, their price tag means they don’t always make financial sense.
While demand charges are more common for commercial customers with big electricity bills, some States and utilities are considering the addition of demand charges to their electricity rates to motivate people to reduce their electricity use. Utilities in Arizona and Illinois, among others are evaluating residential demand charges.
How Reduced Or No Net Metering Credits Affect Battery Economics In States with true net metering,
You’ll receive a per-kWh credit equal to the cost of electricity on your bill for the energy your solar panels produce. For example: if you pay $0.11 per kWh for electricity from your utility, you’ll get a $0.11 credit on your bill for every kWh of solar energy that your panels produce and send back to the grid.
However, in certain states, you will receive a credit for the wholesale or “avoided cost” rate, which is usually equal to the rate your utility would have paid to buy the electricity somewhere else. As a result, the monetary value of one kWh of solar power that you use at home is higher than one that you send back to the grid. As an example, if you pay $0.11 per kWh for electricity from your utility but your utility only offers a $0.04 credit for electricity sent back to the grid, your solar electricity will be worth $0.07 less if you don’t use it at home. In these states, installing batteries makes economic sense because you’re able to maximize the value of the energy you generate at your own property.
At the end of 2015, the Nevada Public Utilities Commission (PUC) voted to change its net metering policy to a policy based on the avoided cost rate – one of the first states to make such a change. In Hawaii, where more than 10 percent of homes have rooftop solar, the PUC has also reduced net metering credits in a way that makes energy storage a worthwhile investment.