Tennessee building and business owners have seen their state government roll out new energy initiatives over the past few years, and now it’s easier than ever to take advantage of solar power and other forms of clean energy in Tennessee. In this guide to solar benefits in Tennessee, we’ll walk you through the benefits that a PV system can offer your business.
Benefits of going solar
Solar panels provide a renewable energy source that is sustainable, clean, and cost-effective. One of the many benefits of installing solar panels on your commercial building is the incentives available from the state and federal governments. You can also take advantage of the lucrative tax credits that are offered for commercial installation. Installing solar can help you reduce or eliminate your electric bill, will put your business on a path to energy independence, and will help your business become more socially conscious.
Federal solar system incentives
Your Tennessee business or tax-exempt entity is eligible for a 30% Federal Investment Tax Credit (ITC) (available for solar systems under 1MW AC and for battery storage systems). This 30% solar tax credit is available until 2032. You may be able to claim an even higher credit (40%-50%) – for example, by using American-made components. Projects over 1MW AC must meet additional guidelines.
Bonus Depreciation
Bonus depreciation allows an investor to recognize 80% of the depreciation in the same tax year the system is placed in service. Starting in 2023, the percentage of capital equipment that can be expensed immediately drops by 20% per year (e.g., 80% in 2023 and 60% in 2024) until the provision drops to 0% in 2027.
The USDA Rural Energy for America Program (REAP) provides grants (as high as 50%) to help fund the installation of renewable energy systems, including solar panels, battery storage, generators and energy efficiency projects. of the total installed cost, up to $500,0 The program provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to improve energy efficiency.
Tennessee solar incentives
Tennessee offers a sales tax exemption for solar and battery installations. Save money on your utility bills
Utility bills are going up and will continue to rise. The cost of electricity generation is increasing and with it, the cost of doing business. A commercial solar installation with the appropriate battery storage means you may not have to pay utility bills again (depending on your consumption) and your business will be immune to rising energy costs. Even if you are not able to completely eliminate your electric bill, you will see a huge cost difference by going solar.
Property Value Increases
Installing solar panels in TN has been shown to increase the Net Operating Income of your building and make your commercial property more attractive and valuable should you decide to sell it. Having a solar panel system installed on the roof can also eliminate the need for an expensive roof replacement and decrease the amount of maintenance needed for your building.
Reduce your carbon footprint
The environmental benefits are also worth mentioning, as solar power is clean energy that doesn’t emit any harmful pollutants into the air – something your employees and customers can be proud of.
Solar energy is a great energy solution for your business. Additionally, you may want to consider installation options that could help improve the aesthetics of your building. There are many benefits directed towards commercial businesses installing solar panels including tax credits, rebates and grants offered by the federal government and some state governments as well. Depending on your business’s size and location there may be programs available that provide even greater financial incentives like property tax reductions and electricity rates based on production levels.
At Nashville Solar Works, our Nashville-based team of solar professionals would be happy to help you find a commercial solar solution that best fits your business needs. Contact us today!