The sun is shining on solar panels – but the summer won’t last forever

There are compelling reasons to invest in solar power for your business. Andrew Moon warns business owners not to wait – the incentives are about to change.

AUTHOR: Andrew Moon, Head of Business Development at Swoop

You will have noticed that in the last few months, energy bills have gone from an inconvenience to a major international headline story.

The pressure is on all of us to reduce our energy consumption: first because of the cost as Putin’s actions in Ukraine push the prices ever upwards. 

Secondly, there is the environmental aspect of energy: COP27, the 27th United Nations Climate Change conference, will be held from 6 to 18 November in Egypt, and governments will be ordered to incentivise businesses to reduce their carbon emissions.

If solar panels and heat pumps were once niche purchases for businesses, expect change: they are swiftly becoming mainstream.

Help to buy

There are already strong economic reasons for buying solar power equipment for your business. The government’s Super Deduction Scheme, which gives tax relief on assets bought for a company, has made purchasing solar equipment more affordable. Factor in grants and subsidies for these purchases and you can quickly work out that businesses have found a way of paying a lot less to go green. 

Is solar mainstream yet? Not quite – but it’s getting close. I’ve spoken to many larger businesses recently which are at some point on the pathway to solar energy: some are getting quotes, others are watching the electricity meter run backwards on sunny days. 

The companies that make and instal these solar panels all lead on the time it will take to pay back the cost of purchase, promising that they will pay for themselves in a matter of a few years. It’s a tempting proposition. 

The trouble is that companies don’t know how they should fund this purchase: should it all be paid out of existing funds? 50/50 loan and savings? Is there a grant available?

The answer will be different for every business, but whether you own or rent a roof to put a solar panel on, you should think about doing it sooner rather than later. (If you rent, your relationship with your landlord might colour your decision.)

The best time is now

Looks likely that in the coming months, there will be further incentives to push businesses into reducing their energy consumption. And not just the cost of energy: incentives and grants for transitioning to solar power will be part of many government strategies to achieve Net Zero.

As with all trends, it makes sense to get in early.

As an example, about a year ago, Swoop wrote to all the advisors in our network to recommend that they put their clients on our Energy Tracker, a system designed to alert companies when they were paying too much for their utility bills and switch them to a cheaper tariff. Those who did so will have found themselves in an enviable position now that prices have skyrocketed. 

(The Swoop Energy tracker is still a smart move to help your clients save on costs, by the way.)

I think that the day when the best deals and incentives for buying solar equipment will be behind us. The Super Deduction is due to end soon. There will be less need for grants as more businesses get solar power from their own pocket and fewer people will need bridging to make the purchase. 

In short, act now: solar panels make a great early Christmas present to your business. The incentives – from so many angles – will never be this good again.