Ontario Electricity Rates are Rising: How Commercial Solar Protects Your Bottom Line
In Ontario, electricity has become increasingly expensive. Despite constantly rising electricity rates, demand for energy is continuing to rise, and is now expected to increase 75% in the next 25 years.
That’s why Ontario businesses that need affordable and more predictable power sources in large supply are transitioning to commercial solar as an alternative to traditional power sources.
Today, investing in solar isn’t just about demonstrating your organization’s commitment to sustainability. Commercial solar can protect your business’s bottom line while reducing its dependence on fossil fuels and locking in reduced costs for the long-term.
Keep reading to learn more about why Ontario’s electricity costs are higher than ever, and how solar power can serve as a cost-effective alternative for power-hungry businesses.
Why Electricity Costs are Rising in Ontario
In November, Ontario electricity rates increased by 29% following approval from the Ontario Energy Board (OEB).
According to the OEB, the increase was not anticipated. The rise in electricity rates is attributed to higher-than-expected nuclear generation costs and the need to recover a budget shortfall from the previous year, which created a deficit that must now be paid back through higher rates.
Nuclear power currently plays a major role in Ontario’s electricity system, and it is expected to remain an important part of the province’s energy mix for decades to come. However, nuclear facilities are complex and costly projects that can take many years to build and bring online.
At the same time, renewable energy sources such as solar have become more affordable than ever and can be deployed much more quickly. Solar projects often cost significantly less per kilowatt to build and can be installed in a fraction of the time, making them an increasingly practical way to add new power to the grid as electricity demand continues to grow.
What Ontario Businesses Can Do About Rising Electricity Costs
Businesses have the ability to take control of their power costs. By exploring on-site renewable energy options, businesses can reduce their exposure to rising nuclear electricity rates.
How Commercial Solar Protects Your Bottom Line
Businesses who invest in solar can see:
More predictable energy costs
Lower long-term operating expenses
Improved energy reliability and resilience, with lower energy losses
Less dependence on nuclear energy and fossil fuels
Few things are more frustrating than being affected by energy decisions which you have no control of. By generating your own power through solar, your business stops relying on costly alternative energy sources.
At VCT Group, we’ve helped businesses across Ontario take control of their power costs by switching to on-site solar power.
Our commercial solar power solutions allow companies to lock in a predictable cost of electricity for decades, making it easier to control budgets and plan for the future.
Additionally, switching to commercial solar can result in lower long-term operating expenses, better resilience to fluctuating energy costs, and a measurable boost to sustainability goals.
Understanding Solar Power Costs and ROI
Commercial solar offers strong, long-term returns, but understanding the true cost and return on investment (ROI) requires more than a simple price-per-panel calculation. Every commercial site is different, and solar ROI depends on how well a system is designed to match a business’s energy use, site conditions, and local electricity costs.
The cost of a commercial solar system includes the design, equipment, and construction needed to build a reliable, long-lasting asset, while also taking into account maintenance.
Solar costs are at their highest during initial installation, but due to numerous incentives and benefits, solar payback times are lower than ever, and are rapidly reducing the impact of upfront costs.
Once installed, the system produces electricity for decades, helping businesses reduce their reliance on purchased power and improve cost predictability over time.
The most effective way to assess commercial solar ROI is through upfront modelling. Our team can help by analyzing site conditions, power usage, and expected energy production, allowing businesses to understand realistic costs and returns before making a decision.
For a better idea of what your ROI could look like with solar, book a free site assessment with VCT today.
How to Increase Your Solar ROI: Incentives and PPAs
There are many options available to lower the cost of solar and enable more predictable ongoing energy costs. These include…
Limited-Time Incentives
There are many incentives available for businesses who switch to renewable energy sources like solar. These incentives are specifically designed to make clean energy more affordable upfront, and are offered via public and sometimes private funding.
However, these incentives are usually limited-time due to limited funding and federal/provincial budget changes. As part of our commercial solar service, VCT will find and help you apply to any solar power incentives you’re eligible for, ensuring you get the rapid payback times we quote you
Here are some of the incentives available for businesses looking to invest in solar power:
As of writing, all of the above incentives are still available. More information about these incentives can be found here.
Solar Power Purchase Agreements (PPAs)
Solar Power Purchase Agreements (PPAs) are long-term contracts where businesses buy energy from solar energy providers at a fixed rate. If solar energy generation is not ideal for your site conditions, or the upfront investment is too high, VCT Group can offer a solar PPA instead. This is an excellent option if you want fixed energy costs and solar on-site without the initial investment cost.
Most PPAs last 10-25 years, and in that time, your rate will stay the same as when you signed on. With PPAs, the cost of power is more predictable and easy to budget around for Ontario businesses.
To learn more about the types of PPAs and how they work, head to our blog:
Learn More about Solar Power Purchase Agreements
Net Metering Programs
Net metering programs allow businesses with solar installations to receive credit for excess electricity they generate and send back to the grid. When your solar system produces more power than your business is using, that energy is exported, and credits are applied to future energy bills.
Keep in mind that being a part of a net metering program may make your business ineligible for other incentives.
Please contact us for more information on whether net metering is an option for you.
How VCT Group Helps Make Solar Viable for Your Business
At VCT Group, we believe that solar energy should always be an accessible option for Ontario businesses — That’s why we’re dedicated to providing flexible commercial solar energy solutions.
From solar array installation to PPAs, we work with businesses to make the transition to solar energy as manageable, sustainable, and cost-effective as possible.
Contact us today to book a free site assessment, or learn how we can help you benefit from clean, renewable energy.