Wide range of returns from business investment in solar – New EECA analysis

A new report commissioned by EECA (Energy Efficiency and Conservation Authority) shows a wide range of rates of return for large businesses considering investing in commercial-scale solar.

EECA says 11 different types of businesses in eight regions throughout the country were analysed using a model to predict solar generation and financial performance.

Strategy and Insights Manager Dr Marcos Pelenur says businesses included food and beverage production, manufacturing, education, waste-water treatment and supply, a dairy farm, three types of retail outlets, a greenhouse, a cool store, a corporate office, and two types of warehousing.

“The analysis shows a wide range of potential internal rates of return, ranging from 0.4% to 8.6%.

On the basis of these findings there can be good investment benefits, but they are clearly variable so EECA recommends businesses carry out an in-depth analysis before investing in commercial-scale solar, to determine the potential financial performance for their company."

Dr Pelenur says businesses can use the framework used in the analysis, which includes:

• whether the business has a very large, unshaded roof space
• how much electricity the business uses and when it is used
• how much the business pays for electricity
• lines company charges – these vary across the country
• how much will the system cost to install and maintain.

EECA commissioned the analysis because there has been limited publicly available information on the cost-effectiveness of commercial-scale solar for businesses.

The analysis is available free of charge. Find out more via the link below.

Commercial-scale solar in New Zealand