Solar has gained popularity in the residential, commercial, and industrial fields in the last 5 years, though it's still a largely state-and-municipality regulated industry. 

Done correctly, businesses can potentially cut operating expenses by up to 40% by going solar.

So how do you know if you're getting the best deal possible before signing a solar contract?

Read our 3 best tips below before entering into a solar contract for your business!

Tip #1: Negotiate

PPAs (Power Purchase Agreements) are not static!

Take some time to think about the reasons you're considering solar for your business and the concerns you have. Write them down and ask your solar partner to make sure they're addressed in your contract. 

Concerned the equipment won't last the full term of the PPA? Wondering what happens if the utility rate drops below the rate you're paying for electricity? Worrying about what happens if a storm comes through and breaks a few solar panels? 

All of these can be addressed in a PPA!

Signing a contract for solar should allow you to heave a sigh of relief and feel secure knowing you are lowering your operating expenses significantly and saving your business money.

Make that contract work for you!

Tip #2: Think Long-Term

Think back to 5 years ago and what your electricity bill looked like then. Chances are good that it was less than what you're paying now by a substantial amount. 

A PPA works by setting the rate you'll pay for electricity for the duration of the contract, meaning you'll not only no longer be at the mercy of changing utility rates, but you'll also have a predictable electricity bill every month. 

As inflation rises and prices increase, your business will be protected with a PPA. 

But what if prices don't increase?

Tying into Tip #1, address that scenario in the PPA by adding an if/then clause that compels the owner of the solar to match current utility rates if they dip below your negotiated kW/h rate.

Get any other concerns you have addressed in writing as part of the PPA negotiations. 

Tip #3: Consider Financing

Solar arrays are usually paid for in one of two ways;

a) the property owner decides to pay upfront for the planning, materials, and build of their right-sized solar array and have most of their monthly electricity bill offset with the power it produces, or

b) they decide to sign a contract to allow another company to build and own the solar array on their property and purchase the power it produces at a discounted set rate for the life of the contract.

Often, at the end of the contract in the second scenario, the solar array can be purchased outright (with the money saved from reduced electricity bills every month!) or the contract can be extended - usually by another 5-10 years depending upon the length of the original contract. 

Financing a solar project reserves your cash and allows you to start saving money on your monthly electricity bill as soon as the solar array is turned on.

An added bonus; investors and financing companies will only finance a solar build with top tier equipment, so you know that you're getting the best deal on equipment without having to do the research yourself.  

Going solar should be one of the best business decisions you can make, so make your input on the contracts work for you and your solar partner and get your solar project started!

Photo attributed to DepositPhotos.com