Solar power has become one of the most popular ways for Australian businesses to cut their power bills and reduce their carbon emissions. This article takes a look at pricing, power output, and potential savings possible with a 250 kilowatt (kW) solar system in Australia.
Pricing for 250kW solar systems
While many factors are at play in the rise in uptake of solar power among commercial enterprises in recent years, the 2 most important ones have been the rising price of grid electricity and falling solar system prices. Solar power is now a popular and cost-effective way to generate clean electricity, and the size of the market is expected to increase significantly both in Australia and around the world in coming years.Commercial rooftop projects & ground-mounted solar farms in the 250kW range, thanks to their size, benefit from economies of scale to a degree not seen among the more common residential systems. Nevertheless, residential solar system prices can still provide some rough indication of how affordable solar power has become in recent years.
Based on the offerings of Solar Choice’s nation-wide, 100+ strong installer network (many of whom also participate in our commercial solar tenders), Solar Choice publishes a monthly update on current pricing trends. For those interested in going solar, this PV Price Check can useful in getting a general idea of where solar prices sit. Read more: The Solar Choice PV Price Check archives
Power yields for 250kW solar systems
There are many factors that influence the output of solar PV systems. These include the orientation and tilt angle of the solar panels, whether or not a tracking system is used, the presence or absence of shading, average system operating temperature, and the quality of the system’s components. All of these factors are taken into consideration when a system is designed in order to arrive at a reasonable estimate as to what that system’s power output will be once it is operational.
The upper limit for the amount of power a fixed-axis, 250kW solar system (or any flat-panel system) can produce is determined first by the amount of sunlight available in the region during a given month, season, or year. As a rule of thumb, a system in Australia will produce 4 kilowatt-hours (kWh) per kW of installed capacity per day, averaged throughout the year. This figure will of course be higher in sunnier locations and lower in less sunny spots (Brisbane receives more sunshine hours than Hobart, for example) and the season (power generation is higher in the summer thanks to the longer days).
For example: a well-designed & installed 250kw solar system (without trackers) in Sydney, NSW would produce about (3.5kWh x 250kw =) 875kwh on a winter’s day. In the summer the same system would produce around (5kWh x 250kw =) 1250kwh. A similar system in Brisbane might produce as much as 875kWh in winter and 1000kWh on a day in summer.
While these figures are only approximations, they serve as a good starting point for understanding how going solar could benefit your business–the more power your solar system produces, the less electricity the company will need to purchase from the grid.
Returns for 250kW solar systems
Similar to system output, return on investment (ROI) for a 250kW system depends on the circumstances. The most important factors that influence solar system ROI are: 1) the up-front and ongoing costs associated with the system, 2) the cost of power purchased from utilities, 3) methods of payment/financing for the system, and 4) the rate at which the solar electricity can be sold, either on the spot market or with a Power Purchase Agreement (PPA).
1) In the long-term, the investment-worthiness of a 250kW solar system will depend on the initial cost paid for the system. Businesses will need to balance system cost against reliability & performance. Choosing a system & installer that will deliver on promises is essential–solar systems have expected life spans of 25+ years. Will the initial price include routine maintenance and repairs, or is it only for the system?
2) Australia’s grid electricity prices have climbed seemingly inexorably in the last few years, putting them among among the highest in the world. Installing a solar PV system allows businesses to avoid purchasing as much electricity from utilities by enabling them to meet a portion of their electricity needs in-house. In this way, going solar can save a business a significant amount of money on power bills.
3) Financing can be vital in ensuring that going solar works for a business that would like to retain capital for other purposes, but can also drive up the overall cost of the system, detracting from returns. If you’re looking at financing your system, balance your options carefully and be sure that you’ve looked into all the options available.
4) In most cases, businesses opt to go solar with the intention of offsetting their power bills. Even when this is the main purpose of the installation, however, the solar business in question may still be able to earn additional income from creating and trading Large-scale Generation Certificates (LGCs), which are a type of renewable energy currency/certificate under the Renewable Energy Target. Only systems larger than 100kW in capacity are eligible to create LGCs. When a 250kW solar project is developed purely as an investment with the intention of selling the electricity generated into the grid, a Power Purchase Agreement (PPA) may also developed with a utility or a 3rd party entity. A PPA would ensure that a set rate is paid for the electricity produced by the solar array, giving the system owner piece of mind about its viability as an investment.
Contact Solar Choice Commercial to learn more about your options
Those considering a 250kW solar system (or any size system) may initiate a dialogue with the Solar Choice Commercial team by filling out the Quote Comparison Request form to the right of this page (click the ‘Commercial’ tab).
About our services:
Solar Choice Commercial has a team devoted to working out how solar PV can benefit our commercial clients. Read about what our Commercial Business Case and Design Team does.
Solar Choice Commercial offers innovative commercial solar PV financing packages that provide unique benefits for eligible clients. Learn more about Commercial Solar Financing with Solar Choice.
© 2014 Solar Choice Pty Ltd