As the world becomes more aware of the impact of climate change, larger companies and international conglomerates are looking to reduce their carbon footprint and invest in green energy. One way they do this is through the widespread adoption/investment in corporate solar energy production. Many big companies have completed solar installations in recent years to improve their sustainability efforts and save money.
Corporate Solar Energy Efforts
One such company is Walmart, which has installed solar panels on the roofs of many of its stores and distribution centers. In 2020, Walmart announced that it had achieved its goal of installing solar panels in 75% of its stores in the United States, making it one of the country’s largest commercial solar power users. The company expects to save $200 million in energy costs over the next five years while reducing greenhouse gas emissions by 2.2 million metric tons.
Another company that has invested in solar energy is Amazon, which has completed several solar installations on the roofs of its fulfillment centers and data centers. In 2020, the company announced that it had installed 62 megawatts of solar capacity across 60 rooftops in the United States, making it one of the largest corporate solar owners in the country. Amazon expects to generate 80,000 megawatt-hours of clean energy annually while reducing its carbon footprint by 153,000 metric tons of carbon dioxide each year.
The Benefits of Adoption
The benefits of corporate solar energy are clear. Not only does it help companies reduce their carbon footprint and contribute to a more sustainable future, but cost savings also incentivize increased investment. Additionally, many states offer tax incentives for companies that invest in solar energy, which can help offset the upfront costs of installation.
Tax incentives can cover up to 50% of the cost of a solar installation, depending on where the commercial installation is. Several tax credits are available to companies that invest in solar energy, including the Investment Tax Credit (ITC) and the Modified Accelerated Cost Recovery System (MACRS).
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The Investment Tax Credit allows companies to deduct 26% of the cost of a solar installation from their federal income taxes. This credit is available for residential and commercial solar installations, and there is no cap on the amount of the credit. Additionally, the ITC can be carried over for up to five years, allowing companies to take advantage of the credit even if they do not owe taxes in the year the installation is completed.
The Modified Accelerated Cost Recovery System is another tax incentive for companies investing in solar energy. This system allows companies to recover the cost of a solar installation through accelerated depreciation, reducing their taxable income. The MACRS allows companies to depreciate solar installations over five years rather than the standard 39 years for commercial property.
In addition to tax incentives, many companies invest in solar energy to earn carbon credits. Carbon credits are tradable permits that allow companies to emit a certain amount of greenhouse gases. Companies that emit less than their allotted amount can sell their excess credits to other companies that emit more; this creates a financial incentive for companies to reduce their greenhouse gas emissions.
Powerful conglomerates adopting corporate solar energy is a positive step towards reducing our reliance on fossil fuels and creating a cleaner, greener future for generations. As more companies recognize the benefits of solar energy, we can expect to see even greater widespread adoption of this renewable energy source.
As one of the most-trusted commercial solar companies operating in Texas, we’re always looking to help businesses reduce their carbon footprint and discover the cost savings of solar energy systems.
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