A solar investment is not only safe and reliable, but it is also inflation adjusted. Whether you own a small business or a large commercial operation, it’s likely that you write a large check to the utility company each month. As a business, 86 percent of the cost of a solar system is offset by tax credits and incentives, offering a return on your initial investment as quickly as three years. (Click here to learn more about Utility Rate Increases)

Call Rising Sun Solar & Electric today for a free site survey and installation quote at (808) 579-8287

• 30 Percent Federal Business Energy Tax Credit (Or, Grant Option)
• 35 Percent State of Hawai‘i Energy Conservation Tax Credit (Or, Optional Refund of 24.5 Percent)
• Federal and State Accelerated Depreciation

Commercial PV system owners enjoy the same tax benefits as residential system owners (Federal, 30 percent; State, 35 percent), with extended state caps (i.e., a maximum tax credit of $500,000 per system, per year) and an accelerated depreciation schedule that allows deductions over a period of six years.

Last year, the federal government also created a grant program in which approved projects can return 30 percent of costs within 60 days of completion. This, combined with the refundable election of the 35 percent state tax credit (at a 30 percent reduction, or 24.5 percent of project cost refund), up to 54.5 percent of project costs can be returned without offsetting any tax liability.

With these attractive tax incentives, commercial PV systems quite literally pay for themselves within three years and produce a 25-year Internal Rate of Return (IRR) of 20 percent each year.

If there is tax liability to offset, this return can be more than 25 percent each year; undoubtedly, this is a significant return on capital.
(Click here to find more details on commercial tax incentives)

Let’s say that your electric bill is at least $2,000 per month, and you have decided to buy $250,000 worth of PV generation. At $6.50/W AC, you are looking at a system size of about 46 kW DC | 38 kW AC.

With 54.5 percent of that coming back in the form of grants and refunds, your net system cost will be about $114,000. If this system is in Kahului, or another sunny location on Maui, the system will produce a savings of $20,000 each year. Even better, as rates begin to increase (as they have at 5.6 percent each year since 2000) so will your annual return.

Additionally, financing options make saving on electric bills even easier. Bank leases and Power Purchase Agreements (PPAs) require no upfront capital or tax liability; instead, you will see a savings of 10 to 20 percent shaved off your bill.

A solar electric system will change the dynamics of your relationship with the utility company. As a clean energy producer, you can "Net Meter" your electricity. In other words, if your solar system produces more energy than you are using at that moment in time, your meter will spin backwards, thereby crediting your account at the full retail rate. Conversely, when your energy needs exceed the system’s output, your meter spins forward.

As a result, your electric meter will measure the "net" difference, and the utility company will then bill you for this amount. (Click here to learn more about Net Metering)