Financial Benefits

In recent years solar energy has emerged as one of the most affordable sources of energy. It is an inexhaustible and renewable energy source which has been used as an ecological way to provide energy for industries and homes.

The source of solar energy are the rays naturally generated by the sun. Solar energy is usable when the electromagnetic radiation of sun’s rays is absorbed by solar panels. These solar panels have solar cells which react with sun rays to produce electricity, which is used to power our houses as well as industries. To transmit and produce power, a complex circuitry system is used to distribute energy. Installing solar panels can greatly reduce electricity bills for corporations and homeowners alike.

Here are some of the benefits of installing solar panels at commercial and residential levels

01

Long-term Value

Solar panels have long lifespans. Much of the initial fee of installing a solar energy system is mitigated by the long-term savings on electric bills. Most solar panels have a 20 to 30 year lifespan and this can increase to 40 years if solar panels are properly treated and maintained.


02

Tax Deductions

As from 1 January 2016, Section 12B of the Income Tax Act (South Africa) was amended from a three-year (50% 30% 20%) accelerated depreciation allowance on renewable   energy to an even quicker depreciation allowance of just one year (100%).

How do we benefit?

Business / company’s tax in South-Africa is 28%. With this incentive, you can deduct the value of your new solar power system as a depreciation expense from your company’s profits. This means that your company’s income tax liability will be decreased by the same value as the value of the installed solar system. This reduction can also be carried over to the next financial year as a deferred tax asset.

This is a direct saving of 28% on the purchase price from day one on the solar system!

The financial ROI model of such a solar power system looks very attractive. If a system is bought cash, the ROI would be 3-4 years and if it’s on a loan, the ROI would be 4-5 years, depending on the local municipality kWh tariff billing rates. Read more here

 

03

Personal savings

Solar panels can provide great savings on electricity bills. By installing solar panels one can save on the cost of electricity which has been increasing every year for electric powered homes and industries. Check with your solar panel provider to see if solar energy would be a good solution to energy bills for your area, home, or business before investing

 

04

It increases home value

Your home value can be increased by installing solar panels. It will increase the price of evaluation for your home because solar panels provide long-term energy savings, environmental benefits, and tax deductions.


05

Provides strength to the local economy

Solar panels don’t just give personal savings, but community savings as well. People waste money by using traditional sources of energy, but it is renewable and inexhaustible source of energy. Solar farms are an example of panels being used to harness energy on a wide scale, which can help agriculture efforts. It also opens new jobs for installers, designers, and manufacturers and allows for people other than large electric and gas companies to succeed in the business of energy.

Solar energy saves two types of green, the environment and your money. Although the initial investment can be high, the long term savings for your wallet and the environment easily trump initial fees. The longevity of panels, tax deductions, and general savings make solar panels the best alternative to traditional energy.