It’s around that time of year when companies start planning their capital budget for the following year. While evaluating and incorporating needs are important, like new or replacement machinery, new plants, or new research and development projects, there are other areas worth appraising as potentially smart, long-term investment as well.
One wise investment worth considering for a portion of capital budget dollars is solar energy. Since capital budgeting helps assess whether or not a long-term investment is in the company’s best interest, there are important factors to take into account while making a final decision to go solar. To help, we’ve put together the top five reasons to include solar in your organization's 2019 capital budget plan.
1. Add to your bottom line: When you’re producing your own clean, affordable energy with solar panels, that’s money saved by not paying your utility for more expensive electricity. By reducing your reliance on the utility monopoly, you free up money that can be allocated to other areas of your business, which in turn adds to your bottom line. Reputable solar contractors can help you determine the impact that adding solar can have to your bottom line.
2. Secure an investment that will last for decades: 25 years is a very long time, and yet that’s also the average warranty of most modern-day solar panels. Even after their warranties expire, today's solar panels are expected to produce reliably for 30-40 years. That’s decades of clean, affordable energy and reliable performance well beyond the ROI period for the initial investment in the vast majority of cases.
3. Increase employee satisfaction: According to Inc.com, sustainability in the work place has been shown to improve employee engagement, satisfaction, and productivity. Adding solar to your organization, whether it be through a more traditional roof mount or with solar carports, is a great way to add a sustainability initiative and appeal to a growing environmentally-aware workforce. While saving money through producing your own energy, you could also add to your bottom line through having more productive employees, completing more tasks in less time, and boosting the overall morale of your organization.
4. Positive impact on the environment, community, and your reputation: It’s no secret that solar panels are good for the environment. They not only have zero emissions attached to the energy they create, but they also save water when compared to traditional energy sources. These environmental benefits can span throughout the community your business operates in by helping build a healthier and more resilient society. This positive effect can be traced back to your organization, providing a positive boost to your company’s reputation.
5. 2019 tax season benefits: When you decide to go solar, there are numerous tax benefits that can help speed up the ROI on your initial solar investment. The federal solar investment tax credit (ITC) allows you to deduct 30% of the solar system cost from your organization's taxes. This incentive will start phasing out at the beginning of 2020, so it’s important to take advantage of the higher incentives while they last.
The state of Arizona also offers a 10% tax credit (capped at $25,000) , while available state and federal equipment depreciation deductions offer additional tax advantages. Combine all of these tax benefits and making the switch to solar is a no brainer.
If you’re interested in learning more about solar for your organization, we invite you to schedule a consultation with a member of our commercial solar team. Not quite ready for a consultation, but want to learn more? You can download our free commercial solar whitepaper, “Is Solar Right for Your Organization?”