Over the past 15 years, the Commercial Real Estate industry in general, and a greater number of New York City’s corporate and commercial buildings specifically, have started to leverage solar energy as a way of reducing costs and fulfilling sustainability objectives.
With office buildings alone accounting for nearly a quarter of the greenhouse gas emissions in New York State, Governor Cuomo has set the State’s agenda to dramatically reduce carbon emissions by 2030. The goal is to have 50% of the State’s electricity generated by renewable sources, such as solar energy.
Why Consider Solar as an Alternative Energy Source
With frequent power outages due to increasing demand on the electrical power grid, particularly during the hottest times of the year, the unpredictability of oil costs, and the growing concern for the environment, more and more commercial buildings are turning to solar energy.
A fraction of the cost compared to traditional energy solutions, solar power offers commercial buildings a clean energy way to significantly reduce operating costs. Requiring little-to-no upfront business investment, a properly installed solar power system will provide electricity for decades – up to 40 years or more. The return-on-investment is typically 3 to 5 years.
Federal and utility incentives are also available to eligible building owners. The Federal Investment Tax Credit (ITC) offers a 30% tax credit that can be put towards the purchase of a solar solution. A number of New York State tax credits are also available and vary throughout the State. The State’s NY-Sun program, which brings together programs administered by NYSERDA, Long Island Power Authority (LIPA), PSEG Long Island, and the New York Power Authority (NYPA), works with participating solar contractors and developers to offset the cost of purchasing and installing a solar panel system for a business.
Solar also offers commercial buildings an intangible benefit that enhances its brand identity and marketability: the public can see it. Just like a LEED-certified plaque, solar broadly displays a building’s commitment to sustainability, which can work to attract tenants often willing to pay higher rents. The 2015 Better Buildings Report outlines direct benefits of solar to both building owners and tenants. The report lists the following benefits:
Solar Benefits for Landlords:
- Reduced utility electricity consumption leads to reduced operating costs, and reduced exposure to volatility of energy prices
- Enhances marketability of the building
- Lowers occupancy costs which facilitates the ability to charge higher rent
- Improves tenant retention due to lower operating expenses
Solar Benefits for Tenants:
- Lowers electricity costs
- Stabilizes electricity costs
- Supports corporate sustainability goals
- Demonstrates environmental responsibility to employees and the community
The report demonstrates that solar can provide landlords with a compelling way to attract new tenants and keep the ones they have.
Fulfilling a number of business objectives – reduced operating costs, sustainability, and enhancing brand identity to attract more tenants and higher rents – solar for commercial buildings is proving to be a smart choice for many building owners in New York City.
Backed by the resources of our parent company ENGIE, our extensive portfolio of energy services allows us to customize a solution that helps you to meet your specific business objectives. To learn if solar energy makes sense for your company contact Donnelly Mechanical, an Engie Company.