Financial and Environmental Benefits of Solar for your Business

Why is it so Useful to Australian Business?

Australia’s natural conditions and environment make it ideal for solar energy production, but what is it about this renewable energy source which makes it such a viable option for businesses?

Hedging against rising energy costs: By investing in Solar Energy you will be protecting your business from the inevitable rise in electricity costs. Electricity prices have also risen significantly over the last three years and will continue to do so. A Solar Energy system will provide your business with free energy and result in lower overall costs for your electricity.
Reduction in Energy Bills and Production Costs: The most obvious benefit of solar power to small businesses in Australia is its potential for dramatically reducing energy bills. By producing your own electricity off-grid, you are taking steps towards becoming self-sufficient and reducing the amount of electricity you need to purchase from the grid.
Grants and Incentives: If you install photovoltaic cells at your commercial property, you could be awarded an STC from the Australian government. STCs – or Small-scale Technology Certificates – are offered to small businesses as an incentive for converting to renewable energy sources. The cash amount of your STC incentive depends on the capacity of your solar energy production system, but is usually worth several thousand dollars.
Feed-In Tariffs: If you produce a surplus of solar energy, you could be reimbursed for the energy you feed back into the national grid. This is known as a feed-in tariff. As of 2015 there is no universally observed standard for feed-in tariffs nationwide, and the amount you could potentially receive varies from state to state. However, the tariff can provide you with a healthy, supplementary income and enables you to recoup the installation costs of your photovoltaic cells more quickly.
Solar power is green, clean and quiet: Protecting your profit margins is important, but it is also vital to protect the planet for your children and their children to enjoy. Solar is a quiet and environmental friendly way to produce electricity. Solar power is responsible for only a fraction of the carbon dioxide produced by other energy conversion methods, like coal-burning power stations. What’s more, it is renewable, which means that we aren’t depleting a finite source of power.
Good for your business and marketing etc: By installing a Solar Energy System you will be setting yourself apart from your competitors and casting your business in a positive light. People love a business with an ethical backbone that invests in the local environment and community. Market your investment and show your customers that you are taking an active role in the community by investing in the sustainability of your business and the environment for coming generations.

In addition, The 2015 Federal Budget included a proposal to introduce tax concessions for small businesses who convert to solar power. All small businesses will get an immediate tax deduction for any individual assets they buy costing less than $20,000. (Currently, the threshold sits at $1,000).

This $20,000 limit applies to each individual item. Small businesses can apply this $20,000 rule to as many individual items as they wish. These arrangements start Budget night and continue until the end of June 2017. Increasing the depreciation threshold will mean improved cash flow for small businesses. It will encourage them to bring forward investment in the assets they need to grow their business and service their customers.

Any assets over $20,000 can be added together (‘pooled’) and depreciated at the same rate. These assets are depreciated at 15 per cent in the first income year, and 30 per cent per year thereafter.

If the value of the pool is below $20,000 it can be immediately deducted until the end of June 2017.

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