Because investing in a solar car canopy is the most strategic — and financially sound — solution for protecting inventory from hail, the Renewvia Energy team has been fast at work constructing dozens of structures at auto dealerships across Colorado and Texas.
Last year, hundreds of storms literally pummeled dealerships all across the United States, producing everything from baseball-size hailstones in Dallas to softball-size chunks in Colorado Springs and record- breaking grapefruit-size balls of ice in northern Alabama. As the storm that slammed Texas over the weekend continues to make its way across the Southeast, similar damage is expected. This is part of a costly trend.
Hailstorms are now producing $8-10 billion in damage every year. Automotive insurers are particularly focused on this now — increasing deductibles to share the losses with their clients or cancelling them altogether.
A decade ago, installing a solar system was three times or more the cost of today. Returns were in the single digits, and payback was over 10 years. However, today’s low cost to install, along with the Federal Investment Tax Credit and Accelerated Depreciation, has the payback down to a few years plus returns up to 20 percent and beyond when considering the offset of costly inventory damage, insurance claims, and high premiums.
First offered in 2006, the 30 percent Federal Investment Tax Credit was extended until the end of 2020, and then, it will decrease down to 10 percent by 2022. This credit lets businesses recoup 30 percent of the cost of their solar systems — and any structure to host it — in the first year. Combined with the current 100 percent Accelerated Depreciation and local utility rebates, you can recoup more than 50 percent of the system cost in the very first year alone. Another way of looking at it:
By including solar in the implementation of a protective canopy, you get to deduct 30 percent of the total build cost, and thereby get the solar portion (and then some) for free — not to mention the ongoing increase in free cash flow.
The solar support structures and car canopies are designed to match the high caliber aesthetics of each dealership, including under canopy lighting. Production and installation of a solar car canopy for protection can happen in a few short months.
An ancillary value of solar canopies for the protection of inventory is the elimination of most of a dealership’s power costs. With the escalation of in the cost of power, owning a solar array that generates the majority of power needed to operate the business provides a valuable hedge against ever-increasing utility bills. The solar array produces free cash flow in the form of energy savings, which can later be realized at the sale of the business and/or property.
100-kilowatt system costs $200,000 to install and creates $20,000/year in free cash flow, with net cost of install coming in at less than 50 percent of total outlay.
Butler Automotive Group, a family-owned company based in Macon, Ga. that employs nearly 700 people at 14 new and used car dealerships across Georgia and South Carolina, has converted dormant roof space into solar power generators that are producing approximately 50 percent of the power required to fully operate their facilities. With a current total (aggregate) system size of 1.25 megawatt (and growing), they have not only cut their energy costs, but also substantially reduced the total carbon footprint of the business and created a powerful marketing tool by highlighting the sustainability goals of the company.
“We see solar power as a definitive investment in our future as a company,” said Marsh Butler, co- president of Butler Automotive Group. “It allows direct energy ownership, mitigating the rising cost of power with a healthy return and even more important, it’s the right thing to do for the environment.”