2023 was a banner year for renewable energy around the globe. According to the Solar Energy Industries Association, the market will triple in size over the next 5 years in the U.S.
Beyond meeting Environmental, Social, and Governance (ESG) requirements and protecting corporate reputations, forward-thinking businesses are looking to save money on rising electricity costs and increase their net operating profit margin with renewable energy.
One major driver making it easier for businesses to adopt clean energy is the federal Investment Tax Credit (ITC). As part of the Inflation Reduction Act of 2022, the ITC offers financial incentives to businesses using renewable energy sources. The credit is currently equal to 30% to 50% of a project installation and equipment cost. These clean energy projects include installations of solar panels, solar wind power, battery energy storage, and electric vehicle (EV) charging stations.
Here is a brief overview of 3 renewable energy opportunities for businesses in 2024:
Solar energy is the cleanest and most abundant renewable energy source. Photovoltaics (PV) solar can generate enough electricity from the sun to power up a large commercial business, offsetting anywhere from 70-100% of its reliance on fossil fuels.
The solar market grows about 24% each year in the U.S. By the end of 2023, 4 million homes and businesses had installed solar energy.
Battery energy storage systems can provide business owners with energy savings and site lease income opportunities:
With a battery set up you store energy and use it during power outages and peak rate times.
Combining a solar battery and solar panels is the ultimate in energy-independence. You can use stored power to run your business during peak times and power outages.
Have spare space on your property (5,000 square feet or more)? You can lease it out. With large battery systems housed on your site, you can make passive income from pre-existing space for many years to come.
It is expected that the number of electric cars sold in the U.S. will be up to 26 million in the year 2028. More than a 1 million new EV charging stations will be needed by 2030 to handle the demand.
Businesses with EV charging stations on-site make it easy for employees and visitors to charge their vehicles. It may also increase traffic to their business, expanding awareness and corporate profits.
The federal EV charger tax credit (under IRA) is returning in 2024 with some changes. Certain labor and construction requirements need to be met to be eligible for the full 30% credit. The significant change for 2024 is that for vehicles to qualify, components made in China don’t qualify for tax credits.
There are currently several renewable energy options that will save you on your monthly electricity costs while reducing your annual tax bill. In addition, you become less reliant on “the grid.”
Businesses are taking advantage of the federal Investment Tax Credit as well as additional state, local and municipal incentives. For instance, agricultural producers and small businesses in rural areas qualify for money under the Rural Energy for America Program (REAP) federal grant.
State incentives vary: Database of State Incentives for Renewables and Efficiency.
Navigating renewable energy tax incentives for your business can be confusing and time consuming. If you want to find out more about what options are right for you, we can help. One of our energy specialists, along with our CEO and founder, can guide you in assessing your energy needs and exploring your best options.
Here’s to a bright and profitable 2024.
Smart Roofs Energy is a turnkey renewable energy company. Clean energy gives companies control over their electric bills. Offerings include rooftop solar PV, ground mounted solar PV, energy storage solutions and EV charging stations.