Economic Analysis

New technology and new policies are making solar energy a financial “no-brainer” for many businesses in Massachusetts. Solar panels are more efficient and cost effective, the system’s production is connected to the utility grid through net metering, and the tax credits and other financial incentives are phenomenal. These systems operate for 25 or more years with little or no maintenance and pay for themselves many times over before the warranties run out. It’s no wonder these systems are being installed all over the state at an exponentially increasing rate.

To acquire a system for your business, two basic approaches can be pursued:

Owning the system

Owning the system allows you to directly receive the tax incentives and ongoing production incentives. Plus, the electricity it produces is directly metered and fed to your business which is connected to the utility grid as a net metering facility. This means that at times when the system produces more electricity than you need, the utility meter runs backward, giving you retail value credit for that energy. At the end of the billing cycle you pay only for the difference (net) between the energy you used and the energy you made. If the system makes more than you use, the utility is forced to carry the credit forward or transfer it to another account of your choice. With all these ways to save money, avoid taxes, and generate revenue, the payback time for solar can be 4 to 7 years for typical situations. Generating more than clean energy, these systems generate an estimated rate of return of between 8% and 15% after taxes.

Hosting the system

If the up-front cost of the system is out of reach, why not have someone else buy it? In this situation, the system that serves your business is owned by another company. You purchase the electricity at a discount. As a host, you don’t buy the system, just the clean electricity it produces. While it depends on the particular arrangement, savings of up to 33% are not uncommon. Often, a buy-out option is included in the agreement. This allows you to eventually take ownership the system for a fraction of the initial cost.

For additional information, visit the UnUtility Electric, LLC website.