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As we transition to a greener and more sustainable world, businesses of all sizes are making sustainability their top priority. One of the most effective ways a business can reduce its carbon footprint, and save on its electricity bills, is by decreasing its reliance on fossil fuels. Businesses can do this by installing an onsite solar energy system.
This guide will help you to make informed decisions about implementing a solar energy solution onsite. We will explore the benefits and advantages, how the system works, and the things you need to consider to implement a system successfully.
Whether you are a small business or a large corporation, this guide will provide you with practical advice to help you to make your business more sustainable. By harnessing the power of the sun, you will be able to reduce your negative environmental impact, save money, and become a leader in the transition to clean energy production and use.
Browse the guide at your own pace or open the dropdown menu to click the links to jump to the sections you need the most.
Section 1 – What is Onsite Solar Energy?
Onsite solar energy, also known as onsite solar power or onsite solar photovoltaic (PV) systems, is where electricity is generated by using solar panels that are directly installed at the location where the electricity will be used. This means that solar panels can be installed in a variety of locations, including rooftops, car parks, or open spaces within a business’s premises.
These solar panels are made up of photovoltaic cells. These cells convert sunlight into direct current electricity or DC. An inverter is then used to convert the DC electricity into a usable alternating current electricity or AC. AC electricity can be used in most appliances and equipment within commercial and industrial settings.
The size of an onsite solar energy system can vary depending on the size needed, from a small installation to a larger system that covers an extensive area. The amount of electricity generated by these systems depends on several factors, including the size and orientation of the solar panels, the amount of available sunlight, and the efficiency of the system overall.
Solar panels can help businesses to reduce their dependence on fossil fuels and traditional grid-supplied electricity. This also allows them to reduce their greenhouse gas emissions and mitigate against the negative environmental impacts that come with a conventional energy generation system. Long term cost savings can also occur, as bills can be lowered. Further money can be saved as the price of solar panels become more affordable.
Businesses that opt for onsite solar energy will find that their brand image becomes more positive, as they demonstrate their commitment to sustainability and renewable energy. As many customers, investors, and stakeholders are looking for these attributes in the businesses they use the products of, buy from, and work with.
Section 2 – How does Onsite Solar Energy work?
Section 3 – Different Types
There are various types of onsite solar energy systems, each has its own technologies and characteristics to meet the specific needs of a business, both in commercial and industrial settings. The most common onsite solar energy system types include:
Roof-Mounted Solar Systems: Roof-mounted solar panels are the most popular choice for businesses that have roof space availability. They are a cost-effective option, that allows areas that would be unused to be utilised with a solar system installation. The system can be installed into a new construction or can be retrofitted into an existing structure. Make sure you take shading, roof orientation, and load bearing capacity into account.
Ground-Mounted Solar Arrays: If your business has enough land, a ground-mounted solar system may be a suitable option. These systems are typically larger and can be optimised to generate a large amount of electricity due to maximum solar exposure. This makes them ideal for industries that require a substantial amount of energy, including in agriculture and manufacturing. The systems are also useful for their scalability, meaning they can be expanded if needed.
Carport Solar System: If solar panels are integrated into the carport’s structure, they can be used to provide parked cars with shade and generate electricity. These can be incredibly useful to businesses that have large car parks, such as in shopping centres or for corporate companies.
Solar Canopies and Awnings: These can be integrated into architectural designs, to be used to generate electricity and provide shade. These systems are especially useful when integrated at shopping centres, retail parks, recreational facilities, and hospitality venues.
Building-Integrated Photovoltaics (BIPV): BIPV can integrate solar panels into the design elements of a building, including its windows, facades, or roofing material. As this approach mixes functionality with aesthetics, it is a popular choice for commercial settings.
Solar Thermal Systems: These systems harness the sunlight to generate heat. This heat can be used for various industrial processes or for heating space and water. Businesses within sectors such as laundry, hotels, and food processing plants will benefit from these systems.
Hybrid Solar Systems with Storage: Integrating solar panels with batteries allows businesses to store excess renewable energy that they generate onsite during the day. This can then be used on cloudy days, at night, or when peak demand is high. These hybrid systems will enhance a business’s energy efficiency and their grid resilience.
Floating Solar Arrays: Businesses that have access to a body of water, may be able to implement a floating solar array. These can be installed on reservoirs, ponds, lakes, or other sources of water. They can also create benefits including reduced water evaporation and efficient cooling of the solar panels.
Section 4 – System Design and Technology Selection
Choosing the Right Solar Panel Technology
Ensuring your business selects the appropriate solar panel technology is an important step when installing an onsite solar energy system. There are several options with the main choices being monocrystalline, polycrystalline, and thin-film panels. Each of these options come with their own specific benefits, including:
Monocrystalline Panels: These panels are both efficient and sleek in appearance, both of these factors make them a suitable choice for businesses that have limited roof space.
Polycrystalline Panels: These panels are a cost-effective option and are suitable for businesses that operate in locations that have diverse conditions.
Thin-Film Panels: These panels are flexible and lightweight. This makes them suitable for installation areas with irregular surfaces or for businesses that require a specific aesthetic.
When choosing the right technology for your business, make sure it aligns with your energy goals, available budget, and physical constraints. Ensure you evaluate several factors including efficiency, durability, and the manufacturer’s warranty to ensure a reliable and long-lasting system.
Sizing the Solar Energy System
Choosing the correct size for an onsite solar energy system depends on the needed appropriate capacity of the onsite solar energy system, that is based on the business’s energy consumption patterns and available space. Accurately assessing your businesses energy needs ensures that the system can offset a significant amount of the electricity demand. Businesses must make sure they analyse their historical energy usage data and consider potential future growth when sizing the system.
The system’s performance can be impacted by several factors that need to be considered, including solar irradiance, shading, and panel orientation. Engineers should be able to use specialised software to create simulations using these variables and factors, in order to optimise the arrangement and tilt of the panels to ensure maximum energy capture.
Making sure your solar system is properly sized will allow all of your expectations and requirements to be fulfilled. This will also allow your business to take advantage of cost savings and environmental benefits.
Integrating Energy Storage Solutions
Integrating energy storage to an onsite solar energy system advances and optimises the use of your electricity generation. Therefore, enhancing a business’s self-consumption and grid resilience. Batteries will store any excess energy generated during the day to be used throughout hours of low sunlight or when peak demand is high. Balancing your business energy supply with demand will improve the overall efficiency of your system.
By implementing an energy storage system, businesses can reduce their reliance on the grid, which will help to lower your business’s energy costs and enhance your energy independence. Energy storage can also protect businesses from grid outages, as they ensure business operations continue with minimal to no disruptions, as well as preventing any loss to revenue.
When selecting the right energy storage system for you, ensure that you consider the desired capacity needed, the discharge rate, and the cycle life. The most popular choice are lithium-ion batteries, as they have a high-energy density and efficient cycling capabilities. Other forms of battery, such as flow batteries or advanced lead-acid batteries, may be more suitable depending on your specifications.
Section 5 – Suitability and Feasibility
Solar Energy Feasibility Study
Any business wishing to make the first steps towards installing an onsite solar energy system, must first carry out a solar energy feasibility study. This form of assessment evaluates the viability and the potential benefits a business can take advantage of if they integrate a solar energy system into their operations.
The study analyses several factors, including solar resource availability, site suitability, energy consumption patterns, regulatory considerations, and financial projections. As well as local solar irradiance, shading, and orientation. By doing this the feasibility study will determine the optimal place for the installation of the solar panels.
To determine the necessary size of the system the study examines the existing energy consumption profile. This allows the engineer to calculate a portion or the entirety of the business’s energy usage to install a system that can meet these needs.
In order to ensure compliance with local codes, regulatory and permitting requirements are fully scrutinised.
The study also explores the financial aspects of an onsite solar energy system, including estimated costs, potential savings, return on investment (ROI), and payback period.
This data-driven assessment allows businesses to make informed decisions about whether to install an onsite solar energy system, including its type and size. Doing this helps a business to successfully foster sustainability, reduce their operational expenses, and enhance both their environmental stewardship and long-term resilience.
Suitable Locations and Industries
A range of businesses across various industries can benefit from the installation of an onsite solar energy system. Examples of businesses that are suitable include:
Commercial Buildings: Businesses that have large rooftop or car parks have ample space to install a solar panel system. Suitable business spaces include office buildings, shopping centres, hotels, and restaurants.
Industrial Facilities: Businesses, that typically have high energy demands, can use solar power to offset a significant portion of their electricity needs. Suitable business spaces include manufacturing plants, warehouses, and industrial complexes.
Agriculture Operation: Solar energy can be used to power irrigation systems, machinery, and other operations. It provides a reliable and cost-effective source of electricity for activities that are energy intensive. Suitable business spaces include farms, vineyards, and agricultural facilities.
Educational Institutions: Onsite solar energy systems can be implemented within schools, colleges, and universities. Helping to reduce energy costs, as well as being an important educational tool to teach students about the significance of renewable energy. Suitable business spaces include classrooms, libraries, and administrative spaces.
Retail: Solar panels can be installed on rooftops to offset electricity within the retail sector, including for lighting and refrigeration. Solar energy can help to lower operating costs and electricity bills, whilst the business shows its customers it is committed to sustainability. Suitable business spaces include supermarkets, retail chains, and standalone shops.
Data Centres: Data centres require the continuous operation of their servers and cooling systems; therefore, they have significant energy demands. Onsite solar energy can help to achieve this high demand, whilst also reducing the business’s carbon footprint.
Recreational Facilities: Solar energy can be used to power lighting, heating, and ventilation systems. Many recreational establishments wish to associate themselves with being eco-friendly, making the use of solar energy the perfect option for their sustainable goals. Suitable business spaces include gyms, sports complexes, and other recreational facilities.
Municipal Buildings: Adopting solar energy within municipal buildings can save the taxpayer money, regarding electricity bills. The use of solar energy can also promote sustainability within the wider community. Suitable business spaces include government offices, libraries, community centres, and other public facilities.
If you do not own the land or space in which your business carries out its operations, it is recommended that you contact your landlord, as solar energy benefits both the landlord and the tenants.
Section 6 – Cost and Finance
The cost of an onsite solar energy installation can vary depending on several factors. These factors include the size of the system, the specific requirements and energy needs of the business, as well as the location of the business.
The main cost considerations you must keep in mind are:
Installation Costs: The upfront cost of an onsite solar energy system typically involves the components (e.g., solar panels and inverter), the mounting structures, the electrical wiring, and labour. The overall cost is influenced by the size of the system that is to be installed, how complex the installation is, and if any modifications need to be made to the building or property.
Financial Incentives: Ensure you research new grants, tax relief schemes, incentives, and other beneficial schemes. The UK Government provides financial support for businesses that wish to adopt a renewable energy system, including onsite solar energy systems. The most significant scheme is the Smart Export Guarantee (SEG) scheme. This scheme provides businesses with a payment from their energy supplier for any excess electricity they generate that is fed back into the electrical grid.
Financing Options: There are several financing options available for businesses, that will help them to manage the upfront cost when installing an onsite solar energy system. Options can include commercial loans, power purchase agreements (PPAs), and leasing arrangements. These options can help a business to pay the cost over time, allowing them to benefit from the electricity generated and the savings it provides.
Maintenance and Operational Costs: Onsite solar energy systems require little maintenance, although businesses should make sure that they budget for regular inspection, panel cleaning, and potential repairs and replacements of components over the entire lifespan of the system. Compared to other conventional energy sources, using solar energy will produce lower operational costs.
Return on Investment (ROI): The ROI for an onsite solar energy installation depends on the upfront costs, electricity savings, and potential revenue from any incentive scheme used. The initial investment can be significant, however, there is significant potential for long term energy cost savings and income from exporting excess energy to the electrical grid.
Make sure you consult with solar energy provider, financial advisor, and industry experts when assessing the specific costs and financial viability of an onsite solar energy system.
Smart Export Guarantee (SEG): The scheme was introduced in 2020 and requires larger electricity suppliers to offer payments to businesses that feed their excess energy generated back into the electrical grid. The rates and terms are set by the individual suppliers, and businesses have the opportunity to choose the most favourable export tariff for them.
Non-Domestic Renewable Heat Incentive (RHI): Closed for new applicants. For businesses that have applied for the scheme, it focuses on providing support for the installation of a renewable heating system, including an onsite solar thermal system. The scheme provides a financial incentive over a set period for businesses generating heat from a renewable source.
Business Energy Efficiency Grants: There are various grants and funding programs available for businesses, at both local and regional level. The grants are there to support businesses that wish to implement energy-efficient measures.
Enhanced Capital Allowance (ECA): This scheme allows businesses to claim accelerated tax relief on the cost of certain energy saving and renewable equipment. This includes solar panels. Benefits of this scheme involves reducing the overall tax liability of a business that invest in eligible technologies.
Regional and Local Initiatives: Ensure you check which funding incentives and grants are available within the region you are in, as these can differ throughout the UK. The programs are often administered by the local authorities or regional development agencies. Check the availability terms for each grant or program as they may vary.
Section 7 – Benefits and Advantages
Cost Savings: By generating their own electricity, a business can benefit from potential significant cost savings on their electricity bills. They can also reduce their reliance on the electrical grid, which helps to mitigate against rising energy costs. Onsite solar energy provides a predictable and stable cost, as sunlight is a free and an abundant resource.
Energy Independence and Security: Businesses that generate their own electricity will be less reliant on the electrical grid, meaning that they are better prepared for disruptions of the electrical grid, which includes fluctuations and power outages. This ensure that businesses operate continuously with minimal downtime.
Environmental Sustainability and Corporate Social Responsibility: Adopting an onsite solar energy system shows that a business is committed to both environmental sustainability and corporate social responsibility. Solar energy is a clean and renewable source, which produces no greenhouse gases when in operation. By moving away from fossil fuels, businesses can lower their carbon footprint and mitigate against climate change. Showing their commitment to sustainability can boost a business’s reputation, attract environmentally conscious customers and investors, and align with consumer expectations.
Long-Term Financial Returns: Solar panels typically last for 25 years or more. Over time the initial investment will be paid off through energy cost savings and potential revenue. The return on investment (ROI) can be favourable, especially as electricity prices for grid electricity rises and the cost of solar panels decreases.
Brand Differentiation and Marketing Opportunities: Businesses with onsite solar energy systems can differentiate themselves from their competitors as they will strengthen their sustainable brand image. Consumers are becoming more favourable towards companies that demonstrate their commitment to sustainability and environmental stewardship. By showing this commitment, a business can become more attractive to environmentally conscious customers, boost brand loyalty, and gain a competitive advantage.
Educational and Employee Engagement Opportunities: Onsite solar energy systems can provide educational opportunities for both employees and stakeholders. Employees can then engage in sustainability initiatives and promote awareness and understanding regarding the renewable energy technology. This can help a workforce to have a culture of environmental responsibility.
Section 8 – Regulatory and Permitting Considerations
Navigating Local Regulations and Building Codes
Be aware that local building codes and regulations can vary when installing an onsite solar energy system, and businesses must adhere to the ones that apply to them. The location of where solar panels can be placed may be dictated by zoning regulations. The safety of the installation and structural integrity are dictated by the building codes. Businesses should consult with their local authorities to obtain any necessary permits, in order to avoid potential legal issues or project delays.
Businesses should work with professionals who understand the local regulations to ensure that the onsite solar energy system is installed in a way that meets all of the requirements. This could involve submitting detailed plans, calculations, and specifications for both review and approval.
Ensuring Compliance with Net Metering and Interconnection Standards
Net metering can allow businesses to receive credits on their electricity bills, by feeding any excess electricity generated by their onsite solar energy system back into the electrical grid. It is essential that businesses understand and comply with the net metering regulations, in order to take full advantage of the opportunity and to optimise their cost savings.
There are interconnection standards that outline the technical and safety requirements for those connecting an onsite solar energy system to the electrical grid. Businesses should comply with these standards to ensure the system’s operations are safe and reliable, whilst also protecting the grid and the utility workers.
To ensure proper interconnection and compliance, businesses should communicate and co-ordinate with their utility company. This could involve submitting applications, conducting inspections, or complying with specific technical specifications.
If a business fails to address the regulations and permits, they could be faced with lengthy and costly project delays, fines, or even the dismantlement of their onsite solar energy system. To ensure that the installation is successful, consult a professional, this could be a solar energy consultant or a legal advisor.
Section 9 – Other Onsite Energy Technologies
Energy Storage: Onsite solar energy systems can be connected to energy storage technologies, such as batteries. Energy storage allows any excess energy generated during the day to be stored and used at night, on cloudy days, or when there is a high demand for electricity. Doing this allows businesses to optimise the use of solar energy, increase their self-consumption, and improve their energy resilience.
Smart Grid Integration: This technology enables bidirectional communication and interaction between the business’s energy system and the electrical grid. Smart grid integration allows businesses to manage their energy consumption more effectively, enable demand response programs, and monetise excess solar energy by feeding it back to the electrical grid during peak demand periods, if applicable
Combined Heat and Power (CHP) Systems (Cogeneration): This technology simultaneously generates electricity and heat from a single source. Utilising this system allows businesses to optimise energy efficiency and utilise solar energy to offset the electricity component of the CHP system. This can lead to significant energy cost savings and enhanced resilience.
Energy Management Systems: This technology can help to optimise the use of multiple onsite energy technologies, including solar. The system monitors and controls energy consumption, generation, and storage in real-time. It integrates data from the solar energy system, energy storage, and other onsite technologies. This can help businesses optimise their energy usage, identify opportunities for improvement, and make informed decisions about energy usage patterns.
Electric Vehicle (EV) Charging Infrastructure: Businesses can implement electric vehicle charging stations onsite. By connecting them to an onsite solar energy system, they can provide a sustainable and cost-effective source of electricity. Using solar energy can offset the grid electricity, further reducing the businesses carbon emissions and operating costs.