Despite the fact that the media is more focused on the Reserve Bank of Australia (RBA) announcing numerous increases in cash rates, additional challenges that Australian businesses must face with include rising energy expenses. When you consider the recent increase in the cost of grid power, the cost of installing and operating rooftop solar simply makes good financial sense with regard to the cost of doing business.

First, let’s break it down and explain why it is a no-brainer for commercial organizations to install solar panels on their rooftops in the year 2024.

Comparison of solar prices and financial outcomes: the most important factors to take into account

In order for a commercial venture to be profitable over the course of a lengthy period of time, it must be able to provide a discernible return on investment. When it comes to solar energy, there are a number of potential financial outcomes that may be determined by taking into consideration a variety of elements, including the following:

Rooftop, ground-mount, and car-shade solar solutions all have different capital costs, and these costs will vary based on the kind of solar system being installed. In addition, the capital cost will be affected by the degree of difficulty involved in integrating the system into your business location.

The generation and consumption of the system: The sizing of your system is of the utmost importance in order to obtain the best possible result. You may get choices to boost the performance of your system from a company like Grid Electrics Group. These options include the addition of tilt frames or trackers, both of which can significantly increase the amount of solar energy that is released into the atmosphere.

Incentives that are available include energy certificates, the amount of which is determined by the size of your system and the location of your business. Small Technology Certificates (STC) offer an initial advantage to companies who install systems with a capacity of up to 100 Megawatts (kW). The value of these certificates can reach up to forty thousand dollars, which is about thirty percent of the entire cost of the system. Large Generation Certificates (LGC) are available to systems that generate more than 100 kW of electricity. These certificates are awarded for every 1 MWh of electricity that the system generates and can be claimed once every six months. When compared to LGCs, the Victorian Energy Efficiency Certificate (VEEC) is advantageous for businesses located in Victoria since all awards are created in a single hit, which occurs 18 months after the installation of the system. Currently, the price of a VEEC certificate is between $75 and $80, whereas the price of an LGC certificate is roughly $50.

Given that the cost of energy is a sizeable amount of the overhead expenses of the majority of businesses, any change in the cost of power can have an effect on whether or not it is feasible to install solar panels. We are witnessing a significant increase in the cost of power over the majority of the country, as can be seen in the graph that is shown below.

When compared to the prices of the grid in 2024, solar

Both an outright purchase and a power purchase agreement are two different types of procurement that may be considered in order to provide you with a more accurate picture of how the transition to solar energy might look for your business. Both of these examples of work are based on actual projects that were completed.

Free and Clear Purchase
For the purpose of providing you with an illustration of how the financial consequences for a system of the same size have evolved over the past several years, the following are some costings for a 500-kilowatt solar system divided into three distinct time periods. Pay particular attention to the most significant component that has changed, which is the wholesale energy price.

In the event that you have previously considered solar energy but have concluded that the financials do not meet your requirements, it is abundantly evident that the current moment is the most favorable time to take benefit of an Outright Purchase.

Agreement for the Purchase of Power (PPA)
A Power Purchase Agreement is an option to an Outright Purchase that customers might consider. In this scenario, a solar provider such as Grid Electrics Group completes the installation of the system at no cost to you, and you are only responsible for paying for the power that the system generates. You are going to pay for that at a rate that is far more competitive than the retail power rates that you are currently paying.

The following table provides an illustration of the potential financial outcomes that might result from installing solar through a PPA. The costings for three different-sized systems are based on the current pricing. Another point to make is that these are actual examples of consumers who have taken use of solar energy by means of a Power Purchase Agreement.

Do You Wish to Acquire Further Information?

Twenty-four is shaping up to be an excellent year for making the transition to commercial solar energy. Therefore, in order to obtain pricing that is matched to your particular requirements, you need begin with a feasibility evaluation.

Additionally, you will be able to obtain the most recent news and discover what is going on in the commercial solar industry by visiting Grids Insights.