Commercial Solar Panels & Systems Costs and Pricing Factors

Commercial solar panel costs have dropped significantly over the past decade. According to NREL, the cost of commercial solar in the U.S. has declined by two-thirds since 2010, primarily driven by more efficient solar technology and lower inverter costs. In Texas, the average cost of commercial solar panels is 7.6% lower than the national average.

Solar is often thought about in terms of the price per watt of power capacity, which equalizes system costs similar to the price-per-square-foot metric the in real estate sector. The average installed cost of solar for commercial purposes is $2.00 per watt. A 100 kilowatt (kW) commercial solar system will produce about 136,000 kilowatt-hours (kWh) per year, enough to offset the full electricity bill for an average commercial customer in Texas, and would cost approximately $200,000 before applying federal, state, and local incentives.

Each commercial installation and system is different, so the best way to find out how much solar would cost at your location is to request a free site analysis. We will assess the feasibility and the ROI of commercial solar panels for your business.

Commercial Solar Panels Cost Breakdown

The first question we get from every customer is, “how much do commercial solar panels cost?” The answer, of course, is that it depends on the size of the system, type of equipment, and your electricity usage. There are many factors that determine the cost of commercial solar panels for businesses.

System Size

The size of your system will be determined by your available roof space, electricity usage, and financial goals. As systems scale to larger sizes with more panels, the overall cost of your system will increase primarily due to the larger number of panels, mounting infrastructure, and cabling.

System Type

The commercial solar application you choose will also affect the overall cost, even if the same solar panels are used. The equipment used to attach solar panels to a standing seam metal roof is different than a ballasted system on a flat roof. Solar carports and ground mount systems also require an additional structure and typically require cabling to run underground back to the electric meter. Each of these applications have costs that vary based on the type of components required for the system.

Solar Panels, Inverter, and Other Technology

The components of a commercial solar power system include the solar panels, the inverter power station, the cable management system, the mechanical mounting system, and the monitoring and energy management software system. The selection of the manufacturer, type, and quality of each of these components will affect both the upfront cost of the system as well as the long-term cost of ownership. For example, high-efficiency premium solar panels have a higher price tag but will produce more energy over the lifetime of the system. A high-quality cable management system will cost more upfront will be more durable and require less maintenance over time.

Rebates, Tax Credits, and Other Incentives

Aside from the cost of the equipment and installation, there are government programs and incentives that can lower the cost of commercial solar panels for your business. Federal tax benefits include the 30% investment tax credit (ITC), which will begin a three-year step-down after 2019, and accelerated depreciation. Some local utilities offer distributed generation rebates for onsite solar PV systems. Other programs that may be available to some customers include the USDA Rural Energy for America Program (REAP) grants and Property Assessed Clean Energy (PACE) program financing.

Cost Savings & Return on Investment

UTSA University Village Commercial Solar

The upfront cost of a commercial solar panel system, including equipment costs and installation, may appear to be a significant investment. Keep in mind that there are multiple government incentives, such as the 30% federal investment tax credit (ITC) and local rebates, that can lower the initial investment outlay.

There are many post-installation factors that lower your overall cost of ownership, generate a positive return on investment, and produce significant long-term upside:

  • Ongoing monthly energy savings
  • Utility net metering programs that buy back excess energy you generate and push back to the grid
  • Power price stability protects your business against rising energy prices in the future and utility electric rate increases
  • Increased value of your property should you decide to sell with no impact on your property taxes

As an example, a commercial solar system that costs $80,000 will be eligible for a $24,000 tax credit. Bonus depreciation can lower the cost by an additional $20,000. If that system saves $5,500 in energy costs each year (plus 2% annual inflation in the utility electric rate), it will pay back in just over 6 years and generate a 14% internal rate of return (IRR).

For certain systems and financing solutions, it is possible to go solar with a positive cash flow from day one.

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Take advantage of historically low commercial solar panel costs to lower your operating expenses and realize the many benefits of solar power for your business. Request a free site analysis to get a custom price quote.

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By clicking “Contact Me” you authorize Freedom Solar to call you and send you pre-recorded messages and text messages at the number you entered above, using an autodialer, with offers about their products or services, even if your phone number is a mobile phone or on any national or state "Do Not Call" list. Message and data rates may apply. Your consent here is not based on a condition of purchase.

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