Practice 03 / 05
Generate on site, buy smart, use less.
Terminal electrical loads are large and inescapable. Site lighting, cranes, boilers, and specialized buildings push annual consumption to 1.5 million kWh at the top end. This practice covers on-site solar, the financing structures that make it pencil, and the certificate markets behind them.
The Short Version
The barrier to solar is not the panel. It is the financing.
Photovoltaic hardware is straightforward: panels make DC, an inverter makes AC, the grid absorbs the surplus through a production meter. The real engineering decision is who owns the system, who captures the incentives, and who carries the maintenance risk for 25 years.
Industrial distribution facilities run 30 to 200 acres, with annual electrical use between 500,000 and 1,500,000 kWh. Depending on location and utility rates, that is a $5,000 to $20,000 monthly bill. Loads at this scale justify serious analysis of renewable generation alongside efficiency retrofits and control systems for site lighting.
Sticker price is misleading. Federal and state incentive programs, correctly stacked, can offset 30 to 50 percent of a solar installation’s upfront cost. Most owners never see that number because they price the hardware and stop there.
30%
Federal Investment Tax Credit on system cost
8–10 W
DC output per square foot of solar panel
15–20 yrs
Typical Power Purchase Agreement contract term
30–50%
Upfront cost offset when incentives stack
Inside This Practice
Four decisions that set the economics.
01 · Solar PV Fundamentals
Panels, inverters, and what a roof can actually hold
Photovoltaic panels convert solar radiation into direct current; an inverter converts it to AC for on-site use or grid export. Output planning starts with a rule of thumb, roughly 8 to 10 Watts DC per square foot of panel, and assumes south-facing exposure with clear, unobstructed sunlight.
Roof-mounted systems carry a prerequisite that gets skipped too often: confirm the structure can support the added weight before any layout work begins.
02 · Ownership Structures
Cash, PPA, or lease: three ways to pay for the same electrons
A cash purchase captures every incentive directly and pairs with 25-year panel warranties, but the owner carries the capital cost and lifecycle maintenance. A Power Purchase Agreement flips that: the provider installs and owns the system on your roof or ground space, keeps the incentives, and sells you power at a fixed rate for 15 to 20 years, with a buyout, renewal, or removal option at term end.
PPAs are usually the most cost-effective route at terminal scale, but providers set minimum project sizes, typically 30 to 100 kW. Leases fill the gap for very small installations, where the lease payment plus the reduced electric bill should still land under the old bill.
03 · Federal + State Incentives
The 30 percent that changes the math
The federal Investment Tax Credit covers 30 percent of system cost, and MACRS 5-year accelerated depreciation compounds the benefit. State programs vary widely: direct rebates priced per DC Watt (usually capped), Performance Based Incentives paying roughly $0.15 to $0.40 per kWh produced, and Feed-In Tariffs paying $0.40 to $0.80 per kWh exported, with no net-metering credit.
None of it is free money without conditions. Rebates can be taxable, PBIs stop paying the moment the system goes down, and a long fixed-rate FIT contract loses value as utility prices climb.
04 · Certificate Markets
SRECs, RECs, and buying clean power you cannot generate
SRECs monetize solar production in states with a Renewable Portfolio Standard: utilities must buy credits or pay the Alternative Compliance Payment, which sets the price ceiling, while a floor price protects producers. Smaller operations typically sell through an aggregator, who bundles credits and takes a commission.
Where on-site generation is not feasible, Renewable Energy Certificates purchase the environmental attributes of off-site generation, one REC per megawatt-hour, generally $0.01 to $0.20 per kWh on the voluntary market. RECs are additive: every kWh consumed is still bought from the utility.
Proven In The Field
Where this practice has shipped.
Energy Efficiency
Westborough Solar
Transflo, Westborough. PV siting analysis with a side-by-side cash, PPA, and lease financing comparison.
Read the case study →
All Cases
Browse every case study
Porous pavement, storm water features, genset locomotives, and more, each with the numbers behind it.
All case studies →
All Pillars
Explore the other practices
Water Systems, Air Quality, Terminal Design, and Innovation & Resilience. Each pillar collects the technologies that shape a terminal’s footprint.
All practice areas →
Partner With Us
Running the solar numbers?
Tell us your site size and load profile and we will share the financing comparisons and incentive references that apply.