3 Things You Need To Know - Are Solar Panels For Small Businesses Worth It?

Are solar panels for small businesses worth it? As a business owner, you handle everything from accounting to marketing. When considering solar power, you need facts, not a sales pitch.

Solar panels provide clear financial benefits. Beyond reducing emissions, solar power lowers operating expenses and improves cash flow by cutting overhead costs and making electricity bills predictable.

Are Solar Panels For Small Businesses Worth It?

You’re the owner and operator of a small business, and I’m confident in saying you wear many hats. Accounting, customer service, and even marketing ultimately fall on your shoulders. However, this is why you do what you do… You simply love it.  

But this responsibility is challenging. Always making decisions, especially business-critical ones, is draining. Luckily, the decision to move your small business to solar power isn’t one that requires a lot of time or effort! 

There are significant benefits to migrating to solar power as a small business owner. From the publicity to investing in the future of our planet, solar just makes sense. However, many business owners are not aware that solar power isn’t just environmentally conscious; it’s also bottom-line conscious.  

Here are 3 Things You Need to Know about Cost-Savings with Solar Power:

The Investment Tax Credit (ITC) is one of the strongest solar incentives available to a commercial business right now. The federal tax credit allows you to deduct 30% of the cost of your solar panel installation directly from what you owe in federal taxes — dollar for dollar.

This isn't a deduction. It's a tax credit. That means if your solar installation costs $80,000 and you qualify, you reduce your federal tax bill by $24,000.

Solar Investment Tax Credit (ITC)

Business owners who choose to go solar are not going solar alone. The Solar Investment Tax Credit (ITC) was created to ease the financial burden of companies that decide to go solar.  

Time is of the essence to get the most significant benefit from the ITC. In 2021 the reduction will decrease down to 10% for businesses.  

“A tax credit is a dollar-for-dollar reduction in the income taxes that a person or company claiming the credit would otherwise pay the federal government. The ITC is based on the amount of investment in solar property.

Both the residential and commercial ITC are equal to 30 percent of the basis that is invested in eligible property that has commenced construction through 2019. The ITC then steps down to 26 percent for projects that begin construction in 2020 and 22 percent for projects that begin in 2021. After 2021, the residential credit will drop to zero while the commercial and utility credit will drop to a permanent 10 percent.” – SIEA.org 

Quick ROI

One of the reasons commercial solar makes sense as a long term investment is the payback period. For most businesses, that payback period runs between 3 and 7 years depending on system size, energy costs in your area, and how much electricity your operation uses.

Seeing a quick return on investment (ROI) from converting to solar is a bonus for many business owners. In fact, businesses are seeing payback in as little as two years! Imagine… by going fully solar powered, you’ll be able to invest your newfound savings directly back into your operating budget.  

The overall cost of going solar has dramatically decreased.

Virtually no one disagrees with the environmental benefits of going solar, but – historically – few small business owners could realistically afford to invest in the equipment needed to fully convert and run a building(s) on solar power. 

That’s far from the case today. Since 2011, the cost of switching to solar has decreased by 80%, but that trend will not continue. By waiting, buyers are putting themselves at risk of losing valuable tax credits – such as the ITC.  

The combination of more market availability and federal grants has contributed to making solar power an option for small business owners to consider.  Virtually no one disagrees with the environmental benefits of going solar, but – historically – few small business owners could realistically afford to invest in the equipment needed to fully convert and run a building(s) on solar power. Transitioning to solar energy was simply out of reach for most.

That’s far from the case today. Since 2011, the cost of switching to solar has decreased by 80%, but that trend will not continue. By waiting, buyers are putting themselves at risk of losing valuable tax credits – such as the ITC. These savings help make solar panels worth the investment.

The combination of more market availability and federal grants has contributed to making solar power an option for small business owners to consider. Modern systems can also generate excess electricity, which can often be sold back to the grid for further utility savings.

Why TerraSol Energies

TerraSol Energies has been installing solar panels across Pennsylvania, New Jersey, and Delaware for years. We handle the full process — system design, permits, installation, and connection to your local utility. We work with commercial businesses of all sizes, from small retail operations to large manufacturing facilities.

Having a solar system that works for you also reduces your carbon footprint. Save money with renewable energy. We are a local solar installer in PA, NJ, and DE.

If you’re ready to get a clear picture of what solar would cost your business and what you'd save, we offer a free consultation with no pressure and no obligation.

Solar isn't the right move for every business at every moment. But for most businesses that pay significant electricity bills and plan to stay at their location for the next 5–10 years, the numbers are hard to argue with.

Want to learn more about how solar power can make a difference in your organization? Contact us today!

Are solar panels for small businesses worth it? For most business owners looking at today's tax credits, rising energy prices, and a payback period measured in years rather than decades — yes, solar is worth it.

Frequently Asked Questions

How much does commercial solar cost for a small business?

Commercial solar cost varies by system size and location, but a typical small business system runs between $40,000 and $120,000 before incentives. After the 30% federal tax credit and any applicable state incentives, that number drops significantly.

What is the solar tax credit for businesses in 2024–2025?

The investment tax credit currently sits at 30% of the total solar panel installation cost. It applies to commercial and residential solar power projects that begin construction before 2033. Some projects qualify for bonus credits that push the percentage higher.

Does solar make sense if my business leases its building?

It’s more complicated, but not impossible. Some landlords are open to solar installation agreements, especially if it increases property value. A power purchase agreement may be an option if your landlord won't support a full install.

What happens during power outages?

A standard grid-tied solar power system shuts down during grid outages for safety reasons. If you need backup power, a battery storage system connected to your solar installation can keep you running during grid outages.

Is solar worth it for a business with a flat roof?

Yes. Flat roof installations are common in commercial solar and often easier to work with because the racking system can orient panels at the ideal angle regardless of roof pitch.

Will solar reduce my demand charges? Solar power can reduce demand charges if your system produces enough during peak demand hours. A well-designed solar panel system timed to your peak usage windows can make a real dent in that part of your electric bill.

Can solar power cover all of my business's energy needs?

That depends on your roof size, location, and how much electrical energy your business uses. Most businesses offset 60–100% of their electricity costs with a properly sized system. Your installer will size the system based on your usage data.