FCAS Explained: How to Get Paid to Help the Grid

This month, we sat down with Smart’s Solutions Engineer, Peter Whitehouse, to dive into the ins and outs of the Frequency Control Ancillary Services (FCAS) market. In this blog, we’ll explain what FCAS is, why it’s impor...

It’s no secret that solar power delivers significant benefits to our environment. Reducing water consumption, air pollution, carbon emissions and reliance on fossil fuels is reason enough to make the switch to solar energy.

However, not all businesses grasp just how beneficial solar power can also be for the bottom line.

In this article, we explore how solar power can deliver real cost savings, improve cash flow, allow you to take advantage of government support and tax incentives, and modernise your business to build your reputation among clients and candidates. Here are four simple reasons why solar energy is a smart business investment.

 

1. Energy Savings

Let’s start with the most obvious benefits renewable energy can deliver to your business; slashing your energy expenditure. According to Woolworths CEO Brad Banducci, electricity is the third largest cost for the business, behind only labour and rent; a situation faced by many larger Australian businesses. 

A 100kW solar system can save as much as $25,000 per year compared to grid supplied electricity, with 100kW installations requiring an outlay of around $70,000 - $90,000 depending on site specifics. Small to large scale systems across the board are generating enough savings to drive sub 5 Year paybacks or cashflow positive finance positions from Year 1.

And electricity rates are increasing. A comprehensive report commissioned by Energy Consumers Australia found that between 2016 and 2017, the average commercial energy bill increased by 36% in states like South Australia, with New South Wales and Victoria not far behind. Furthermore, the ABC reports in 2019 that despite Federal Government intervention to regulate costs, energy prices continued to rise.

Reducing your reliance on traditional energy providers can unshackle your business from these ever-rising prices.

 

2. Stabilise Cash Flow

Price hikes and seasonal variances in energy rates can destabilise your cash flow, which is the lifeblood of any successful business. For many SMEs running a tight ship, covering unforeseen energy costs can limit essential investment in growth activities like marketing, hiring and product development.

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.

Combining low ongoing maintenance costs with a robust monitoring system to ensure you’re getting the most for your money, your business can enjoy predictable energy expenditure for years to come.

 

3. Rebates and Incentives

Thankfully, 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.

The value of STC and LGC rebates is not set in stone, so it’s important to discuss your eligibility and expected savings with your commercial solar installer.

 

4. Modernise Your Business

The fourth reason why solar is a smart business investment is less tangible than immediate cash savings, but it’s certainly no less important. Embracing renewable energy is a fantastic way to immediately modernise your business and present a positive message to clients and candidates. 

The corporate green movement has been led by businesses of all shapes and sizes in the past decade, and for good reason. A recent study of US and UK consumers found that 88% of respondents sought businesses who embraced sustainability in their operations; a figure consistent with a comprehensive retail study by Nielsen.

Not only does solar energy signal to your existing and future clients that you take sustainability seriously, but it may also help you to attract the top talent in your field as the values of jobseekers continue to change. 

In an article for Smart Company, Gary Smith, CEO of sustainable foodservice packaging company BioPak outlines how Australian candidates across multiple industries are searching for sustainable businesses that align with their own green values.

As you can see, embracing solar power isn’t only a commendable way to help the environment. It’s also a savvy business decision, which can pay dividends in sometimes surprising ways for years to come. If you’d like to discuss how your business can develop a renewable energy strategy, get in touch with Smart Commercial Solar today.New call-to-action 

Written by
Anastasi Kotoros

Head of People & Culture

Image CTA

Related Articles

FCAS Explained: How to Get Paid to Help the Grid

This month, we sat down with Smart’s Solutions Engineer, Peter Whitehouse, to dive into the ins and outs of the Freque...

Technology & Solutions

Top 5 Things to Think About When Considering Solar Car Shades for Your Business

Solar car shades are an excellent way to enhance your business’s sustainability while providing valuable benefits like...

Technology & Solutions

How Easy is it to Add Battery to a Solar System?

Adding a battery to an existing solar setup can be an effective way to enhance energy independence, control energy cos...

Technology & Solutions

Back to insights & our latest articles

Back to Articles

Other Categories