There are many reasons why going solar in Southern California is a good idea for businesses, but it will never make more sense than now while commercial solar incentives are still at their prime.

Solar Energy Builders Orange County, CA

Southern California is home to some of the nation’s most expensive electricity. In fact, electricity costs for business owners in Southern California are steadily increasing each year, all while the cost of investing in solar is steadily decreasing.

For business owners weighted down by ever increasing electricity bills, this means now is the perfect time to invest in the solar energy revolution.

With one of the strongest markets for solar in the world at their doorsteps, Southern California business owners can greatly reduce their operating costs, and see a 100% return on investment within 3-5 years

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A tax credit that can be claimed on federal corporate income taxes for up to 26% of the cost of a solar photovoltaic (PV) system that is placed in service during the tax year. The solar tax credit, one of the best solar incentives in Southern California, will keep decreasing until 2023, where after, any PV system can receive a maximum tax credit of 10%. Click here to learn more about the eligibility for this tax credit.

California is one of the most expensive electric states in the country, but it’s also one of the sunniest. In 2015, the average commercial electric rate was 10.64 cents/kWh. Since then, it has steadily increased roughly 41% to an average rate of 15.01 cents/kWh in 2020. While California solar incentives like solar rebates are still at their peaks, business owners should take advantage of SoCal’s sunny days with solar panels that will reduce or even eliminate your monthly bills.

Since 2017, depreciation on solar panels has become one of the best and quickest ways to minimize installation costs while unlocking incredible savings options for business owners invested in solar. This is because depreciation enables businesses to recover costs from invested tangible solar energy assets while reducing tax liability and boosting ROIs.

Currently, the Modified Accelerated Cost Recovery System (MACRS) is the most common depreciation method for property owners today because it offers 100% Federal depreciation in year one. Essentially, MACRS depreciation speeds up the depreciation process allowing a business to start receiving the benefits of a depreciated solar system by year one, and then staggering state depreciation across the next five years. This system recovers capital costs early on, allowing business owners to strategically use these tax savings to repay loans or reinvest in new opportunities sooner rather than later.

Of course the timeline of returns for MACRS or other accelerated depreciation tax codes depends on each type of property individually. Time frames can vary between 1 to 50 years according to the type of investment made and adjust each year in response to Federal tax incentives. Depreciation is a very helpful and popular tool available to business owners interested in solar energy, if you have any questions about how it works and if it’s the right choice for your business please do no hesitate to ask.

Energy storage systems are an effective way to control demand charges (how the utility doubles your energy cost every month) that riddle business owners’ expensive utility bills. The California Self Generation Incentive Program (SGIP) makes investing in an energy storage system one of the best values in energy management today by offering a cash rebate based on the size of the energy storage system you install, saving you thousands. With the SGIP rebate, battery add-ons with or without a solar system will help to maximize your energy savings. Click here to talk to our team about how battery add-ons can work for you.

Let’s start building an energy smart future for you today!

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