Why should I install solar?
How much savings can I get from my solar system?
On average, our clients save 30% on their energy bills in the first 12 months after installation. Factors that influence the total savings achievable include
- whether battery storage is installed,
- the energy rate the business is paying to their retailer,
- the location i.e. available sunlight,
- the quality and condition of the equipment i.e. panel efficiency, proper cable sizing, how well maintained they are.
What kind of solar system suits my business?
There’s no one-size-fits-all solar system that will suit all businesses. Getting the most out of your commercial solar system requires careful consideration of your premises and some creative thinking to take advantage of your physical space. There are multiple options to suit varying circumstances:
Rooftop: Rooftop solar systems are some of the most popular solar PV systems because they’re safe to install, easy to maintain and cause minimal disruption to operations during installation.
Ground Mount: Ground mount solar systems are a great way to turn unusable pieces of land into productive energy sources, especially if your roof structure is unsuitable for a rooftop system. Ground mount systems are also easy to operate and maintain.
Solar Car Shades: Solar car shades are an intelligent use of space that can deliver multiple benefits in a single form, including providing clean energy to adjacent buildings. These systems can also be modular and adaptable to suit any car park size.
Building Integrated: Building-integrated solar systems take this intelligent design approach to the next level, incorporating solar into the architectural structure such as replacement roofs.
What size solar system do I need?
To get the most value for your money, you should aim to consume all the power that your solar system generates, which will save you from exporting excess power to the grid. A common way to calculate how much solar energy your business will need is to average your minimum daily load over seven days. This table gives a rough guide to calculating your solar system size based on your annual commercial energy costs:
What size commercial solar systems are available?
Solar Systems under 30kW: the smallest tier of commercial installation, these systems can generate around 120 kWh of power daily and do not require the installation of a Grid Protection Unit, representing a significant saving.
Solar Systems between 30kW-100kW: mid-sized installations that are often seen on medium-sized offices, clubs, and stores. Unlike systems 30 kW and under, these mid-sized systems need a commercial solar specialist and extra components required by the network.
Solar Systems over 100kW: larger office buildings, mid-sized factories and hotels are common beneficiaries of solar systems over 100 kW. These larger systems require special meters to claim LGC rebates and come with added complexities.
Solar Systems over 250kW: substantial projects, such as large solar farms, shopping centres and large factories. At Smart, our typical installation falls into this category, and can even be as large as 15 MW+.
How much does a commercial solar system cost?
The capital cost of solar will vary depending on whether it’s a rooftop, ground-mount or car-shade solar solution. The complexity of the integration into your commercial site and your chosen procurement method will also influence the capital cost. For example;
How long do solar panels last?
Does solar work on cloudy days?
In short, yes. However, using real-time monitoring of solar systems located in Adelaide, Brisbane, Melbourne and Sydney, a study by monitoring firm Solar Analytics concluded that different cloud levels decreased output at the following rates:
- High level cloud: Solar output largely unaffected
- Overcast conditions: 50% reduction in output
- Low-level dark cloud: Solar output reduces by 70 – 90%
Battery storage mitigates this issue by storing energy generated while the sun is shining and releasing it on low-output (i.e., cloudy) days.
Can I upgrade my system if my energy requirements increase?
We don't own our premises. Can we still get solar?
Yes, you can still get solar for your business if you're a tenant. In fact, the majority of our projects have been delivered for organisations who lease their premises, including My Muscle Chef, KFC and Officeworks.
For landlord's, there are benefits to having solar installed on their property, whether roof or ground mounted. These include:
- Installing commercial solar on your building can help make lease agreements more attractive and encourage tenants to stay longer.
- Buildings may see lower costs of capital and higher market value because of this reduced risk.
- Many businesses now have sustainability goals which encourages them to seek buildings with lower energy demands. This means you can potentially gain a higher rent in the future.
- The current tenant who purchases the system will be invested in the property and would not likely move quickly.
How does commercial battery storage work?
What is the lifespan of a commercial battery?
The lifespan of commercial batteries depends on various factors, such as battery chemistry, usage patterns, and maintenance practices. Generally, lithium-ion batteries can last anywhere from 10 to 15 years. Their longevity is attributed to efficient cycling, averaging up to 10,000 lifetime cycles. In contrast, lead-acid batteries have a shorter lifespan, typically lasting between 500 to 1,200 cycles.
What configuration of commercial battery storage should suit my needs?
Simple battery storage: The battery will charge using your site's electrical supply (grid energy) during off-peak or low-rate times and discharge through peak or high-rate times.
Hybrid Systems: Combines solar panels and battery storage with the grid, creating a dynamic synergy. During periods of ample sunlight, excess energy is stored in the batteries, ready to be tapped into at night or during peak demand periods.
Backup Capability: Battery storage can serve as an emergency power source during grid outages, ensuring critical operations continue uninterrupted.
Off-Grid Systems: These systems are deployed in locations where connecting to the main electrical grid is either impractical or cost-prohibitive.
How much space will I need for a battery system?
Generally, a commercial battery has a compact design resembling a tall fridge. A 100-kilowatt-hour storage capacity would occupy a space of approximately 2m in height, 1m in width, and 1m in depth.
Lithium-ion batteries are space efficient as they have a wide temperature operating range, typically between 0°C to 38°C, making them suitable for outdoor installations. They are also more energy-dense than lead-acid batteries, meaning they occupy less space while delivering the same or even greater energy storage capacity.
What risks need to be considered and minimised?
Weather damages: Outdoor installations are susceptible to harsh weather conditions like hail, flooding, heatwaves, or fire. Proper design and testing are necessary to ensure batteries can withstand such elements.
Overheating: Batteries being a lithium chemistry, typically can burn very hot and long during charging and discharging processes. Proper ventilation, thermal management systems, and monitoring of battery temperature can prevent overheating and ensure safe operation.
Overcharging: Overcharging can lead to battery degradation, reduced lifespan, and safety hazards. Implementing battery management systems with overcharge protection and following manufacturer guidelines for charging can prevent overcharging incidents.
How do we know if our business needs a battery?
For those who have already installed solar and seen the benefits, battery storage is the next logical step. As energy rates continue to drive uncertainty in the long-term view of Australia's energy market, battery storage uptake is increasing. Battery storage insulates a business from price volatility in one of its largest cost inputs and provides energy independence.
If you have seen a significant increase in your energy rates and already have solar, now is a good time to get a battery feasibility study to understand the latest numbers. Generating renewables during the day is no longer enough to meet a company's ambitious renewable targets and many are not happy to accept increased solar export when looking to expand their existing system. For organisations that need more on-site renewables (and that’s all of them) the right battery is critical in optimising the financial benefits and minimising the reliance on grid power.
What are the main applications of battery storage?
The most basic application of commercial battery storage is to discharge through night-time loads. However, that’s just one application of commercial battery storage. Other applications include:
Peak shaving: reducing electricity consumption during peak demand events when utility rates are much higher. By discharging stored energy during these peak hours, businesses can lower a significant charge that makes up their energy bill.
Load shifting: redistributing energy consumption from high-demand periods to low-demand periods. Battery storage systems allow businesses to store excess energy during off-peak hours and use it during peak hours, effectively reducing electricity expenses and supporting grid stability.
Microgrid: Commercial battery storage plays a crucial role in microgrid applications. Microgrids are localised energy systems that can operate independently from the main grid. By combining solar power with battery storage, businesses can create self-sustaining microgrids that provide reliable electricity, particularly in remote areas or end-of-grid locations.
Grid participation: The more sophisticated client may also want to dispatch their stored energy into the grid and participate in FCAS and NEM spot markets. By using your BESS (Battery Energy Storage Systems) in this way you can generate additional revenues outside of energy bill savings and improve your financial position.
Why do I need to maintain my solar panels?
How often should solar panels be cleaned?
The frequency of solar panel maintenance depends on several factors, including climate, system size, and location. From our experience, we believe cleaning should be approached as a reactive service as most systems ‘self-clean’ with rain. Cleaning is an expensive service so it’s important to time it correctly. Manufacturing or agribusiness clients should consider a routine clean once per annum to avoid any build-up of stubborn particulates, as these will not wash away with rain. Soiling build-up can be detected remotely and should be monitored throughout the first year of operation. If this is a recurring problem for your site, a routine cleaning might be a good investment in your maintenance program.
What maintenance is required for solar systems?
Cleaning and debris removal: Dirt, dust, and debris can accumulate on panels over time, preventing them from absorbing sunlight effectively. While this is often washed away by rainfall, solar panels should be checked and cleaned regularly to prevent soiling.
Panel and system inspections: Regular inspections of panels and systems can help identify potential issues before they become major problems. This includes monitoring performance, assessing the condition of components, checking for damages, and replacing components if necessary.
Wiring and electrical system checks: Commercial solar systems are supported by an intricate network of wiring, and any loose connections can lead to a decline in performance. Regular visual inspections of fittings and cables are necessary to ensure that they are securely attached and free of damage.
System upgrades: Upgrading your solar panel system can boost its performance and efficiency. As new technology becomes available, it's worth considering an upgrade to ensure that your system is running at its best.
While some basic maintenance tasks can be done yourself, hiring a professional service provider may be necessary when dealing with the more challenging tasks that require specialized knowledge and equipment.
How do I know if my solar panels need maintenance?
Keeping your solar system operating at its best requires ongoing attention. By staying vigilant for signs of potential problems, you can detect maintenance issues early and avoid costly repairs down the line. For example, if you notice a sudden drop in energy output or hear unusual buzzing or clicking sounds from your solar system, this could indicate a wiring fault, panel damage, or an inverter issue. Even with annual professional inspections, we recommend conducting regular visual inspections to spot the most common system faults.
Solar Car Shades
What is a solar car shade?
What are the benefits of solar car shades?
Solar car shades can offer many benefits - to business owners, facility managers, car park users and the environment in general.
- For the building owners benefits include; lower energy bills, reduced grid dependency, improved property value, and additional revenue streams with premium parking rates and EV charging making them a compelling investment.
- For facility managers, reduced operational and maintenance costs make it a practical and cost-effective solution. Solar panels as a roofing material are more durable and require less maintenance than traditional shade materials, commonly made of polyethene cloth.
- For car park users, solar car shades provide improved amenities and protection from the element, such as improved security with CCTV installed, lighting and audio systems, signage, and EV charging.
Of course, the benefits of solar car shades extend beyond just financial measures. By powering their facilities with solar energy, businesses can reduce their grid dependency and reduce their CO2 emissions. This, consequently, sends a clear message to customers, employees, and stakeholders of their commitment to sustainable practices and signals they are a market leader.
What is the average lifespan of a solar car shade?
Maintenance plays a vital role in maximizing the lifespan of solar car shades. On average, these structures have a lifespan of 25 years, given proper maintenance. The self-cleaning properties of solar panels installed at a tilt of more than 10 degrees make them less susceptible to accumulating dirt and debris. However, it is recommended to conduct annual electrical maintenance and inspection to ensure the system's overall performance and address any potential issues.
Is a solar car shade right for your business?
Carpark layout: is your car park designed in the most efficient way? Shade structures should be designed with various vehicle types in mind, such as heavy trucks with large turning cycles, as well as safety regulations that enable ambulances, delivery trucks, and fire trucks to access the area.
Obstructions: trees and adjacent buildings can cause shade, which will lower the system's generation. It is essential to assess the presence of such obstructions and, if necessary, prune or remove trees that encroach upon the car park to maximise the system's efficiency.
Ground conditions: soil quality and the presence of underground services within the car park may influence the installation of footings for the solar car shade. Proper investigation and geotechnical analysis are recommended to ensure a solid foundation for the structure.
Permit planning: generally, a Development Application (DA) is needed, but in some cases, the installation can be carried out under a Complying Development Certificate (CDC). It's also important to consider the impact on neighbouring properties and address any concerns they might have.
Do solar car shades impact site aesthetics?
Are solar car shades expensive?
Financing and Procurement
What finance options are available for commercial solar systems?
When considering how to pay for a solar system, a business has several options. These include:
- Capital Purchase (CAPEX);
- Finance via a lease or loan
- Power Purchase Agreement (PPA)
The financing option you choose will depend how your business compares its investments and risk profile.
What is CapEx?
A CapEx purchase is where the business purchases the system using its own free cash flow. The CapEx purchase will bring the business the strongest returns which are typically within 4-6 years. CapEx purchases will require ongoing operation and maintenance as well as costs in replacing components that fail if they fail outside of their respective warranty periods.
A CapEx purchase make sense to a business who:
- Has the available cash to pay for the system;
- Prefers to buy and own assets in the business;
- Has a low cost of capital and therefore using a finance or PPA arrangement would not make sense;
- Is aware of the ongoing operational costs; and
- Want to achieve the fastest return on investment.
What is Financing?
Financing a solar system purchase is good for businesses who do not want to spend their capital on a solar asset and would rather keep that capital for use in their core business.
Finance via a lease or loan makes sense for businesses which:
- Do not want to spend business capital;
- Want the system to be cash flow positive meaning the savings will outweigh the finance costs;
- Are aware of the ongoing operational costs; and
- Understand the risk of finance arrangements in the case of downtime or failures.
What is the difference between a lease and a loan for commercial solar?
The main differences between a lease and a loan lie in who owns the system and how the purchase is treated for tax purposes.
With a lease, the finance company owns the equipment for the duration of the agreement and effectively ‘rents’ it to your business. You can offer to buy it at the end of the term, usually for a small balloon payment. This is typically a fully tax-deductible operating expense.
With a loan, you own the equipment and repay the finance company in the same way as you would a property mortgage. You may be able to claim the interest and depreciation on the equipment as a tax-deductible expense.
What is a PPA?
A PPA or Power Purchase Agreement is a long-term electricity supply agreement, which allows companies to install solar systems on their premises with zero capital outlay. The PPA provider installs, operates, owns and maintains the system, selling the energy back to the company who hosts the system at what is typically a much lower price than they would pay from the grid. This way businesses can access clean green energy sources. without the cost or of maintaining or owning a solar power system.
A PPA option will make sense to a business who:
- Does not want to spend the business capital
- Does not want to take on the risk of downtime or failures
- Does not want to take on the obligation of future operational costs; and
- Wants to continue focusing on core business while an experienced EPC owns and operates the system.
How can a solar system be cash-flow positive for my business?
Price hikes and seasonal variances in energy rates can destabilise your cash flow, which is the lifeblood of any successful business. By implementing solar power, your business can remove this uncertainty, plan with accuracy, and grow with confidence. Solar energy is largely a fixed cost and payback of the entire system can even take less than five years.
Not only can a 100kW solar system save up to $25,000 per year compared to grid-supplied electricity, but small to large-scale systems across the board are generating enough savings to drive sub-five-year paybacks or cash flow positive finance positions from the first year. By reducing your dependence on traditional electricity, your business can also free itself from constant electricity price rises and seasonal uncertainty; allowing you to plan and grow with confidence.
What is the average payback period for commercial solar?
What rebates and incentives are available for solar?
The Australian Government looks favourably upon businesses doing their part for the environment, with a range of rebates and incentives available for solar adopters.
- Commercial systems beneath 100kW are eligible for the Small-Scale Technology Certificates (STC) Program incentive, which reduces your cost based on the amount of power you’re expected to produce over the next 13 years. This discount is often applied while purchasing your solar system and can be a significant rebate (even over 50%!).
- For systems over 100kW, the Large-Scale Generation Certificate (LGC) delivers ongoing savings as opposed to an upfront discount. Businesses claiming LGCs must register to be an Accredited Power Station with the Clean Energy Regulator, which will ensure you can accurately track and claim the solar power you produce.
- VEECs are available for Victorian-based businesses. VEECs are created under the Victorian Energy Upgrade Program and are administered by the Essential Services Commission of Victoria. These certificates are generated through accredited agents and trading companies, using a baseline regression analysis of a site's energy consumption over a 24-month period. This analysis helps estimate the carbon reduction resulting from the installation of a solar system.
How does adding battery storage impact system ROI?
(Power Purchase Agreements)
What are the 3 types of PPA’s?
On-site PPAs: system is installed on your site free of charge and you are billed for the power that the system generates directly into your daytime needs. This is usually at a cheaper price than your aggregated electricity price from your energy retailer.
Behind-the-meter PPAs are great for onsite generation as they offset the most amount of costs from the energy bill. This is particularly valuable to customers with high demand costs that occur during sunlight hours. On-roof construction means that the owner most often ends up owning the system without any cost to the business at all. These types of PPAs can suit any business of any size, regardless of consumption size or capital cost and can incorporate other capital works programs such as roof restoration and carpark solar structures.
However, there is a chance that the PPA contract price may, at some point, be higher than the grid price, and there is not normally a price reset mechanism. Unscrupulous PPA contracts may have significant balloon payments or high exit fees which can impact the business later in the project lifecycle. If you choose to leave the premises you either need to exercise the buyout of the system (at a reducing rate) or transfer the contract onto the new tenant/building owner.
Retail-Sleeved PPAs: an agreement between the wind or solar farm and an energy retailer, which then passes on the renewable generation through a retail agreement for all your electricity needs. The PPA matches the renewable energy supply to your load at that exact time of generation.
The benefit of this structure is that the retail electric supplier takes on the market risks associated with wholesale electricity and the customer gets a fixed price for the energy. This does require a long-term agreement with the retailer, usually this is a minimum of 7 years.
Synthetic PPA - Virtual PPAs: Typically, these are between large businesses and directly to the renewable generator. They provide an opportunity to purchase renewables at a meaningful scale, allowing organiSations the chance to purchase 100% of their energy as renewable energy via the PPA. A properly structured VPPA can provide significant positive cash flows. As the price of solar has decreased rapidly in recent years, it is now possible to lock in a VPPA rate that is consistently below the projected wholesale market price for power at the settlement location.
However, these contracts have both inherent risks and opportunities. For example, if the wholesale market price the project achieves is greater than the fixed VPPA price, the off taker receives the difference. If the price the project achieves is less than the fixed VPPA price, the off-taker pays the project to make up the difference. In this way, a VPPA is a financial hedge against volatile electricity prices. Typically, the buyer receives the project’s Renewable Attributes, or REC’s/LGC’s/Other, but does not take physical delivery of the energy.
Which types of businesses does a PPA suit?
PPAs are suitable for businesses of various sizes, ranging from small enterprises to large corporations. The reasons why organisations might prefer a PPA to purchasing a solar system outright vary, but the scalability and flexibility of these agreements make them adaptable to different energy requirements and business needs. For smaller businesses, solar PPAs provide an opportunity to access solar energy without the upfront costs, enabling cost savings and sustainability. Larger businesses can benefit from the added advantages of battery storage integration, such as energy resilience, time-of-use optimisation, and increased control over their energy supply.
Do we need to own our premises to consider a PPA?
No, you do not need to own your premises to consider a PPA, but it is ideal to have long-term tenancy of your site. If your business leases the site from a landlord, the first step to solar is asking permission from your landlord to make sure they will allow the installation to occur. This should be further formalised in a Letter of Consent (LOC) as well as an amendment to the main lease, or letter of amendment (LOA) to state what happens in the case of the lease expiry or lease termination. This would refer to making good of the property, a condition that would already exist in the main lease.
Once you have an in-principle agreement around the LOC and LOA you are then free to move on to the next step. These letters can be formalised down the track once you have approved the business case for the solar system.
Should we include battery storage in our solar PPA?
For organisations that want to derive even more value from their solar PPA, battery storage systems are becoming a must-have complementary technology. By integrating battery storage into the equation, the overall system offers:
Increased energy reliability: Battery storage ensures a continuous and reliable energy supply, even during grid outages or periods of low solar generation. Stored energy acts as a backup power source, providing businesses with energy resilience and minimising disruptions to operations.
Optimised cost savings: By utilising stored energy during peak demand periods, businesses can reduce or eliminate costly demand charges. Battery storage allows businesses to maximise their solar energy utilisation, further optimising cost savings and increasing the financial returns of their PPA investments.
Enhanced energy independence: Battery storage empowers businesses to become more energy independent by reducing their reliance on grid electricity. By storing excess solar energy, businesses can decrease their dependence on fossil fuel-based grid energy and contribute to a greener, more sustainable future.
Can I add battery storage to an existing PPA?
It is possible to add battery storage to an existing PPA, and indeed many organisations take a two-staged approach to their renewable energy adoption.
There is a caveat, however, in that it is essential to review the terms and conditions of your current agreement to ensure compatibility and consider any necessary amendments. This can become complex, so it might be a good idea to consult with a trusted solar energy provider with experience in battery storage integration when assessing the feasibility of adding batteries to your existing PPA.
Who is responsible for operations and maintenance under a PPA?
The PPA provider (in this case, us) is responsible for operations and maintenance under a PPA.
With a PPA, you are completely protected against performance and operational risks. If a component fails or underperforms, we take care of everything for you. We look after your system until handover, and we make repairs at our own cost.
Our PPAs also include zero maintenance costs. Because you’re only liable to purchase the energy the system generates, you can avoid the inherent operational risk involved in maintaining the system. We own the system and we want it to generate power reliably. That's why we take care in operating and maintaining the system at no additional cost to you.