Many years before Robert “Tito” Norris became an orthodontist, he was what some might call a “naturalist”. Meaning, Norris had a great admiration for nature and a passion for preserving the earth. This is something he attributes to his experiences as a Boy Scout and the teachings of his father, an influence that would carry him throughout his young adulthood and eventually fixate itself deep in his heart as a life commitment.
But Dr. Norris is also a realist and understands the value of money and the economics of an investment. “Going green also has to make financial sense,”says Dr. Norris. Many people like himself have long dreamed of the day when environment and economics would cross at an acceptable point on an investment graph. Now, thanks to federal and local subsidies, that day has come. Going solar is “realistic” and makes sense.
To many business people, the biggest obstacle to going solar is the upfront cost of installing photovoltaic panels. But when that investment is viewed as a hedge against rising energy costs, the advantages become clear.
In urban settings, grid–tied solar generation often makes the most sense. With these systems, property owners harness the sun’s power during the day and draw power from the utility grid at night. Off–grid systems, most often used in remote areas, require large batteries that store excess energy generated during the day for use at night. By comparison, grid–tied systems cost less, take up less space, protect property owners against power disruptions, and reduce reliance on purchased power by up to 30 percent. Monetary savings can be even greater proportionally than energy savings for several reasons:
- Many utility companies charge higher rates during peak usage periods.
- Rates often rise as your consumption increases.
- Grid–tied solar energy systems generate the most power and save you the most money during peak usage times (hot summer afternoons).
And the rate of return on a solar energy investment grows as energy costs rise. Electricity prices have increased 4.6 percent a year on average for the past three decades, according to the U.S. Departmentof Energy. Growing energy demands in Asia, South America and elsewhere will no doubt increase inflationary pressures over the next 30 years. Therefore, fixing a sizeable percentage of your energy cost by investing in solar panel installation lowers expensesin the long run.
Businesses that go solar can also benefit from anumber of tax incentives now and may enjoy additional tax savings in the future.
The federal government provides a 30–percent tax credit for installing solar power systems on commercial facilities, and these investments can be depreciated over five years. In Texas, solar energy systems are also exempt from property taxes.
It’s also possible that under a new presidential administration, Congress might consider carbon taxes similar to those adopted by the United Kingdom. Under this regulatory framework, companies are assigned carbon allowances based on their size and the square footage they occupy. Taxes increase when energy use exceeds that allowance.
Carbon taxes would likely give a boost to nascent U.S. markets for renewable energy credits (RECs). Under a carbon tax system, businesses that generate energy from renewable sources could potentially sell their RECs to other businesses that exceed their carbon use limits.
REC trading already has a toe hold in Texas, based on our state’s renewable energy mandate. This law requires about five percent of Texas’ electricity demand be generated from renewable sources by 2015 and specifies that 500 megawatts come from resources other than wind. This creates a market for solar generators to sell their RECs to utility companies or industrial customers with large energy demands. New Jersey’s REC market is further along in development than Texas’, and my counterparts there tell me that RECs in that state have traded for up to $300 each.
The rising demand for solar and other renewable power sources also creates jobs in a new energy industry sector. As a result, several Texas colleges and universities now offer certificates and degrees related to renewable energy technology and research.
Solar energy technologies may also boost companies’ sales. A growing segment of consumers base their purchase decisions in part on how “green” they perceive manufacturers or retailers are. As a result, some of the country’s largest public relations firms have developed “sustainability” practices to help companies communicate their environmental initiatives to consumers.
Going solar is a natural choice for businesses like organic gardening retailers and health care facilities that must “walk the talk” when it comes to protecting the environment or addressing illness–causing pollution. But harnessing solar power also makes tremendous sense for the corporations that form the backbone of San Antonio’s economy. Installing photovoltaic panels on their corporate headquarters would prove that their commitment to meeting our country’s energy needs includes embracing the unlimited energy solutions of tomorrow as well as the limited resources we relied on yesterday.
Raymond Saenz is CEO of Ecowatt Designs, which integrates solar energy systems for residential, commercial, government and industrial buildings.
