Calcom Blog

FIVE FUNDAMENTAL QUESTIONS ABOUT SOLAR

April 30, 2019

Happy Earth Day! In honor of our beautiful planet, we put together five of the most common questions we get from our customers regarding solar. If you’re considering going solar, there’s no better time than Earth Day to put your plan into action.

How can we determine if solar is right for our business or organization?

There is lots of momentum right now in the solar market. Businesses and organizations of all kinds are adding solar to their sites or choosing to purchase clean energy. But deciding whether solar will work for you boils down to one question: Do you want to offset your organization’s carbon footprint and reduce your electricity bill? While solar used to be installed primarily for environmental benefits, the cost of solar is now so low that it competes or is cheaper than fossil-fuel based electricity. And there’s never been a more critical time to reduce carbon emissions. This Earth Day, the time has finally come: Being a solar-powered enterprise is truly a win-win: a good business decision and a good thing to do.

What is the difference between solar panel efficiency and performance?

Apples and oranges, basically. A solar panel’s efficiency is a measure of how efficiently the solar panel converts the sun’s energy (photons) to usable electricity (electrons). This is expressed in a percentage – and is generally calculated by dividing the size of the solar panel by the amount of sunlight hitting the earth in standard conditions. The efficiency of traditional photovoltaic solar panels ranges from around 16 to 21 percent and can vary depending on the panel’s orientation and other site conditions. Solar performance refers to the overall production of your solar system. Performance is typically measured in kilowatt hours (kWh), or for larger systems, megawatt hours (MWh). Performance over time typically degrades slightly over time – regular washing and maintenance can minimize any losses in production.

What’s the difference between a solar panel warranty and a solar performance guarantee?

Like the warranty on your washing machine or car, solar systems come with guarantees. These include warranties on the components of your system, and performance guarantees on the system itself. In addition, you may also get a separate warranty or guarantee from your solar installer, covering issues associated with installation. Product warranties range from 10 to 25 years depending on the component and are provided by the product manufacturers. A solar performance guarantee provides assurances on the amount of energy your system produces over a specific time frame, usually a year. If production falls short, the guarantor pays you the difference.

How can I determine the best financing method for going solar?

Deciding how to pay for solar is a big decision. There are many ways to finance a solar investment – from cash to solar loans to leases to power purchase agreements. If your business can benefit from tax credits, paying for solar with cash or a loan is a good way to go. The upfront cost is higher, but this is the best return on your investment. Leases and PPAs require little to no upfront investment but are held by third party financiers, which means you won’t benefit from the federal investment tax credit (ITC). Also make sure you explore any industry-specific grants or loans, such as the USDA REAPprogram for agriculture.

Why should we consider solar now when costs continue to decline?

Going solar is always a good decision, in our humble opinion! While it’s true that solar costs have declined more than 70%over the last decade, that number has been leveling off over the last few years (see chart). Technological innovations and market incentives such as the federal investment tax credit (ITC) for solar have helped build a healthy market with rapid growth in adoption and lowering costs. But the ITC for residential is ending this year, and the ITC for commercial projects is lowering from 30% to 10% in 2022. So getting started NOW on your commercial solar project is smart timing.

Have more questions? We would love to help! Contact our team to learn more about solar for your business.

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