Updated 12/06/23
Business owners across the country are cutting operational costs, increasing energy resiliency, and reaching new environmentally conscious customers by adding onsite and offsite renewable energy solutions to their long-term business strategies. But with so many incredible solar energy options, how should a portfolio manager go about deciding which method works best for them? In this blog, we’ll break down the key differences between onsite and offsite solar solutions.
To dive deeper on this topic and identify the ideal solution for your property, download our comprehensive step-by-step guide on implementing renewable energy solutions.
What’s the Difference Between Offsite and Onsite Solar?
Both community solar and onsite solar can allow your business to enjoy electricity savings and support the environment at the same time.
Onsite solar refers to all the ways in which a solar power system can be installed directly on your property. This includes:
In turn, offsite solar projects are not physically located at your facility. Without installing any solar panels, businesses can benefit from various renewable energy programs, such as:
With Offsite Solar, How Do I Know That My Business is Receiving “Clean” Energy?
Offsite solar solutions do not send clean electricity directly to your property. Once the energy from the offsite solar array enters the grid, there is no way to separate the “green” electrons from the “dirty” electrons produced from an oil, coal, or natural gas power plant. Regardless, your support for offsite renewable energy programs is critical to their existence, which increases the total amount of additional clean energy on the grid.
Why Am I Just Hearing About Offsite Solar Solutions?
Federal incentives, such as the solar Investment Tax Credit (ITC), and individual state clean energy initiatives have historically focused on growing the onsite solar market. Only certain states in the U.S have passed legislation that allows utilities or solar companies to develop various types of offsite solar projects. These commodities are rapidly expanding to more states as the industry and nation quickly realize the positive impact and widespread demand for these programs.
How To Choose Between Onsite and Offsite Solar
Considering the following factors will help you decide between onsite and offsite solar for your business:
1. Geographic Location
Offsite solar solutions, such as community solar, are available in select states. Depending on where your facilities are located, they may or may not be eligible for these vehicles.
2. Property Ownership
Businesses that operate in rented properties may find it difficult to get approvals to install onsite solar. In these cases, offsite solar solutions tend to be the easier option.
3. Installation Cost and Maintenance Expenses
Businesses can easily access onsite and offsite solar solutions without incurring any upfront costs. However, should you decide to purchase an onsite solar array with cash or a loan, you may further benefit from available incentives, such as the federal investment tax credit (ITC) or production tax credit (PTC). In order to obtain these tax deductions, you will need to pay for upfront installation costs and bear responsibility for all future maintenance fees.
4. Maximizing Financial Benefits
In terms of getting a greater return on investment (ROI), onsite solar typically provides a higher savings opportunity than offsite solar solutions. It’s worth noting that the various offsite solar programs do still tend to provide companies with savings. Additionally, with offsite solutions, businesses benefit from contract flexibility — meaning your “subscription” can relocate with you whenever you switch to another office powered by the same electric utility company.
5. Property Suitability
If your commercial property has a large available surface area, such as roof space or a parking lot, onsite solar may be more suitable for you. Get in touch with an expert, and they can help determine if there are structural hindrances such as pipes or a curved roof that would prevent you from filling that space with a solar array.
Work With an Expert
No matter which solution you go with, solar energy is an excellent opportunity to outshine your competitors. The Pivot Energy team is ready to support your business in identifying the optimal renewable energy strategy for achieving your solar goals. Reach out to speak with a member of our team or download our step-by-step guide today!
