Advantages Of Solar Energy For Residential And Commercial Users
About the economic advantages of solar energy.
When it comes to solar energy, we all have been reading about how it is an eco-friendly method to generate electricity since our school days. But since our childhood (depending on how old you are), the technology of reaping solar energy has increased phenomenally.
Today, there are advanced methods to extract energy from sunlight and the efficiency of extraction has reached an impressive figure of 23.5% ,which few years back was quite less than that.
The way researchers and manufacturers are developing the solar technology, these figures might become irrelevant in few years! The reason of such urgency is obviously because of our rapidly depleting resources and the pollution that comes along with them as a byproduct.
Experts envision to completely shift on renewable sources of energy such as solar and wind in the future. Insolergy is a solar energy company and has helped many happy customers to go solar. We feel that this is the right time to get on board.
When you read about how solar energy is eco-friendly and better for environment, it is more of a long term advantage. A lot of us won’t bother to switch to solar just for that. Let’s be honest, if everyone really cared about the environment, then we wouldn’t have so much of pollution in the first place and neither would we see environmentalists fighting against corporations.
But a lot of people don’t talk about the other benefits of solar energy and how it not only can benefit the environment but it can also benefit our pockets. So, let’s take a look at how solar energy can benefit you economically, whether at home or at work.
Advantages of solar energy system in a nutshell
Before we get into the economic and personal advantages, let’s take a look at what other benefits we can get from solar as a civilized society.
- Solar is a pollution free source of energy.
- No emission of greenhouse gases, which are the main cause of pollution and global warming.
- It is a renewable source of energy, so there will be no scarcity of it running out.
- Helps create more jobs for people in manufacturing, installation and maintenance.
- Safer than any other forms of generating electricity.
Every year electricity Bills are increasing by 5-7% and the same trend is expected to continue for years to come. Solar can help you secure your future energy needs. With Solar you can lock-in your tariffs for next 25 years.
Economic benefits of solar power
When we talk about the economic advantages of solar energy, there are many. To simplify the advantages, let’s divide it among residential and commercial. There are some similar and some different benefits in adoption of solar energy at homes or at work.
Residential economic advantages
The best economic advantage of adopting solar energy at home is saving tons on your electricity bill. As it is a renewable source of energy and doesn’t cost anything, your solar panels will generate electricity everyday, free of cost.
If you’re going off grid then using solar panels will mean no electricity cost! In simple words, no electricity bill ever! Obviously, you would have to maintain your solar panels but in a long run that cost will be negligible.
Another great economic incentive of installing solar panels at your home is that you can reduce the cost of installation, as government of Maharashtra (India), provides subsidy on solar installation. The government is encouraging people to take the right step towards a better future and so the subsidy will help you out with the installation of your personal solar setup.
There are a lot of people who are adopting solar energy and recovering their investment in few years with less and less electricity bill every month. For instance, Insolergy installed a 5.0 kWp solar panels for a bungalow in Aurangabad, which is producing 7,750 kWh electricity annually. This is helping them save a whooping 66 thousand every year.
Another successful project was of a residential society in Pune, where Insolergy installed a 30 kWp solar panels that produces 46,500 kWh electricity annually. The setup helps them save a staggering 4.65 lakh every year.
You can take a look at another case study of installation of Solar panels for a bungalow.
Commercial economic advantages
Solar energy adaptation is quite apt for the commercial industry, because the consumption of electricity is a lot more than consumption at residences. Commercial buildings have to pay a lot of money on electricity every month but with the right investment, they can reduce these bills exponentially.
Insolergy helped few industrial buildings with the solar panels installation and they are saving a lot of money every year, along with the jaw dropping reduced electricity bills. For example, an industry in Perangut, Pune adopted a system of 400 kWp which is helping them save 49.8 lakhs every year! The savings along with reduced electricity bills easily helped them recover in investment in just 4.1 years.
There are other great examples of different industries which have adopted solar energy and are saving a lot of money and contributing in keeping the environment safe for us and their children.
Another great thing about adopting solar energy for commercial and industrial purpose is the accelerated depreciation offered by the government as a tax incentive. The current rate of acceleration in a year that can be claimed is 40%.
A solar power system’s value decreases over time due to the wear & tear of parts and reduction in efficiency of solar panels. The accelerated depreciation benefit allows the commercial and industrial users of solar power to depreciate the assets built as Solar Power Plant at a much higher rate than general capital assets. This allows the user to then claim tax benefit on the value depreciated in a given year.
The following example further illustrates the point:
Let’s say a commercial or industrial user, ABC Pvt. Ltd., falls under an income tax bracket of 30%. Now suppose this user builds a general asset that is valued at Rs. 1.0 Crore in a given financial year, with an expected asset life of 20 yrs. Under normal circumstances, the user will be able to claim an annual depreciation of 5% of Rs. 1.0 Crore (considering linear depreciation, 100%/20yr = 5%/yr). for purpose of income tax.
This means the user will be able to claim tax benefit of 30% of 5% of Rs. 1.0 Crore per year = Rs. 1.5 Lakh per year for next 20 years.
However, in case of same investment made in a Solar Plant, the user is allowed to depreciate the asset at 40%, thus allowing the user to completely depreciate the asset within three years term, and saving a tax of Rs. 12 Lakh, Rs. 12 Lakh and Rs. 6 Lakh in the first, second and third year of operation respectively.
In conclusion, the advancement in solar technology is expanding at phenomenal rate and with more advancements, the future looks bright. Not only adoption of solar power is great for environment but it has the potential to slowly make everyone independent in terms of electricity and power. Solar is cost effective, environment friendly and answer to the future!
Go Solar With Insolergy Technologies
Insolergy Technologies is a leading solar energy solutions provider in India for residential and commercial use. For free site survey or any other inquiry, Call / WhatsApp: 9082786504 or leave a message.