commercial solar

The Top Five Reasons a Commercial Solar System is a Good Investment for Your Self-Storage Facility

Investing in commercial solar power for boat and RV storage is not only a step towards sustainability but also a savvy financial move. With various incentives available at both federal and state levels, businesses can significantly offset the initial installation expenses and reap long-term benefits in energy savings. Here’s a closer look at the top five reasons a commercial solar system is a financially viable investment for self-storage facilities.

1. Federal incentives are the best they’ve ever been

The Investment Tax Credit (ITC) allows businesses to deduct up to 30% of the cost of a solar system from their federal taxes. This substantial deduction provides a significant financial boost, making solar installations more affordable for businesses.

2. Modified Accelerated Cost-Recovery System (MACRS)

Using MACRS, businesses can recover certain capital costs over a specified depreciation period. This depreciation schedule allows for accelerated deductions, reducing the overall tax burden for businesses investing in solar. Thanks to the MACRS, the asset value of a commercial solar system can be written off in only five years. This depreciation counts as a tax-deductible expense, and the cash flow of your solar investment improves.

3. Self-storage facilities have the potential to generate revenue with net metering.

Where available, net metering enables customers to connect approved renewable generation systems, like solar panels, to the electric grid, allowing them to buy and sell electricity to their local electric company.

When electricity is produced from a commercial solar system, it decreases the amount of energy you need to buy, thereby reducing monthly electric bills. Should your system generate more energy than required, the surplus power is sold back to your local grid. This excess energy is then subtracted from your monthly bill or credited towards a future bill within the same calendar year. Research done by S3 has shown cases where storage facilities have generated significant revenue, sometimes more than tenant rents, from net metering. As reported by Inside Self Storage, owners can expect to save more than 40% on electricity.

4. Solar can increase your storage facility’s valuation. 

Storage facilities are commonly assessed according to their anticipated capacity to generate recurring income. Any factor contributing to net operating income (NOI) growth will likely enhance the selling price. 

Electricity expenses are factored in NOI calculations and are usually one of the largest line items in the operational budget. Installing solar can reduce a utility bill and thus, increase the facility’s NOI, leading to a possible increase in valuation. 

5. A commercial solar system can generate positive PR for your self-storage facility.  

Demonstrating a commitment to renewable energy showcases your company’s dedication to environmental stewardship. It positions your brand as forward-thinking and environmentally responsible, appealing to eco-conscious consumers.

Investing in solar power demonstrates support for local communities by reducing carbon emissions and promoting clean energy initiatives. This fosters goodwill and strengthens relationships with stakeholders. Promoting sustainable business practices through marketing efforts can create a positive brand association and align your business with values such as progress, innovation, and sustainability.

By taking advantage of incentive programs, businesses can transition to solar power with minimal financial barriers. Commercial solar systems reduce energy costs and carbon emissions and boost your brand’s image by adding positive PR. With a range of incentives available, now is the time for self-storage facilities to harness the sun’s power and unlock a brighter, more sustainable future. Contact S3 Partners, we can help.