The age of solar power for industrial buildings is here

Posted On Wednesday, 01 April 2020 09:39 Published by
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As we are all too aware, as a business (or property) owner, the current power crisis in South Africa is having an extremely negative impact on many levels.

Solar_System

Business owners, particularly those in the manufacturing and industrial sector, are having to grapple with the knock on effects of lost working hours and the negative consequences such as dwindling cash flows, lost contracts, a shrinking customer base, and the uncertain future of one’s business.

However, according to Tony Bales of Epping Property, an expert in the industrial and commercial property sector, a well thought out solar system can provide a win-win situation for your business and/or your commercial property asset, and a way to mitigate the harmful effects of load shedding – which looks set to be a reality in SA for some time to come. “Your businesses rooftop is an asset waiting to help you.”

“As the owner of a commercial premises, installing a solar system on the roof of your building will greatly increase the value of your property, as an asset in your portfolio, and make it more appealing to potential buyers should you decide to sell. Not only this, but it will also make it more attractive to tenants – thereby reducing your vacancies and loss of earnings,” says Bales.

“As a business manager operating from a premises that runs of solar energy you can breath easier knowing that you will not need to experience the down time and loss of earnings that so many other businesses are struggling with currently.”

“Not only will you be able to survive future load shedding, but you will also be largely immune to Eskom’s escalating tariffs. Not to mention the tax break you will be getting from SARS for doing your bit for the environment.”

Epping Property advises that those considering installing a solar system but worrying about the seemingly prohibitive cost must again consider the loss of revenue being caused through frequent and ongoing power outages. “Added to this, consider the cost saving over the long term if one no longer has to pay for Eskom generated electricity to run ones business. You will basically be reallocating existing expenses to pay for a new asset that works for you.”

“In effect, the savings you make from generating your own electricity will pay for the installation – until you own the system outright and then you will be enjoying free electricity, a cost saving that you can share with your tenants. They will enjoy lower electricity costs and far greater certainty of running a successful business. In turn, they will likely commit to occupying the space with you for a longer period, reducing your vacancy risks. A renewable energy system will assure them of your commitment to shielding them from future Eskom tariff hikes and unpredictable load shedding. New tenants will immediately find your property attractive for their business,” says Bales.

“When it comes to selling your asset, you will be conspicuous. Looking ahead, most – if not all - prospective buyers will be looking for an asset with a proven renewable energy system to invest in and property owners not augmenting power with renewable energy are likely to be passed over.”

Epping Property provide some advice on installing a solar system, saying that identifying the right company to help you maximise your roof space requires some due diligence. “This will pay off when you find the right combination of energy partner, funding expert and solar specialist.”

There are several ways to structure your entry into renewable energy:

  • upfront full payment and ownership;
  • debt funding;
  • no upfront payments and entering a power purchasing agreement using Eskom savings over time until the system is paid for.

“A solar solution is the start of a long term relationship with industry experts, appropriate funding partners and the environment. The key lies in finding an expert who can take the problem and administrative burden off your shoulders, and to design the right funding model and solar system to generate and extract the maximum amount of energy, thereby attaching a real and often surprising value to the roof space of your property - you will be enjoying an extra yield that is so difficult to obtain in today’s market,” concludes Bales.

Last modified on Friday, 03 April 2020 05:37

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