In the face of well-publicized cyberattacks, ongoing supply chain issues, inflation, and abnormal weather events, the case is strong for going solar in 2022. The good news is that solar projects don’t require a large upfront investment for many businesses. We explain more on these topics below.
Generating Energy to Secure Your Power Needs
Recent cyberattacks, including the DarkSide criminal organization’s attack on Colonial Pipeline, alerted energy consumers that critical energy infrastructure may be at risk. This attack, which shut down a major fuel supply for the East Coast of the U.S., drove up the price of gasoline and spurred panic buying at gas stations across many southern states. To restore the company’s systems, the CEO of Colonial Pipeline paid a ransom of $4.4 million.
Beyond the risk of cyberattacks, the infrastructure of regional electrical grids isn’t immune from failure. In February 2021, Winter Storm Uri affected critical energy infrastructure and created an unprecedented loss of power across Texas.
Businesses can increase their resilience by installing a solar energy system, which can mitigate some of the risks of cyberattack and infrastructure failure.
Hedging Against Future Energy Cost Increases
Current problems with the global supply chain are driving inflation and increasing the price of energy.
On December 1, 2021, eight Pennsylvania electric utilities increased their prices for electric customers by as much as 50 percent. According to the U.S. Labor Department’s Bureau of Labor Statistics (BLS), the price of energy increased almost 30 percent in 2021, and the price of gasoline increased by almost 50 percent.
With an average thirty-year life span and low maintenance costs, solar energy systems produce energy at a fixed cost, which can help insulate companies from future energy price hikes. In finance, the concept of investment diversification is a recognized best practice against various risks. Similarly, diversification of energy sources, including solar as part of a larger energy mix, can help stabilize energy costs.
Addressing Environmental Concerns
Younger consumers, including millennials and Gen Z, look for companies and brands that reflect their values and the importance they place on sustainability and other environmental issues. They consider how products are made and sourced, with 75 percent of total respondents favoring brands that offset their environmental impact.
In Deloitte’s Resources 2020 study, 81 percent of millennials and 64 percent of Gen X reported that they are very concerned about climate change and their personal carbon footprint. Forty-seven percent of millennials responded that it is important for them to work for a company with sustainability and/or climate goals, compared to 33 percent of Gen X, 21 percent of Baby Boomers, and 32 percent of Matures.
By going solar, companies can demonstrate their commitment to the environment and the future, while meaningfully connecting with the values of millennial and Gen Z consumers.
Accessing Solar Energy Without Breaking the Bank
The good news for businesses considering solar is that installing a solar farm isn’t usually capital intensive. In most commercial and industrial solar projects, an investor will pay for the installation. The client pays the investor back over time by way of a power purchase agreement (PPA).
A PPA is a financial agreement with a developer who will design, permit, finance, and install a solar PV system on your property or other site with no capital outlays needed from you. PPAs normally range from 10 to 25 years.
The developer sells the generated solar power to you at an agreed rate per kilowatt hour that is competitive with your local utility. The developer takes advantage of the tax credits and passes the savings onto you.
Making a switch or diversifying your energy sources with a solar energy system can be a safe, financially smart, and profitable decision in the longer term. If going solar in 2022 is something that sounds right for your business, there are many things to consider. We can help you make sense of the entire picture.
To learn if solar is the right move for your organization, contact us for a free solar feasibility report.