The cost and carbon savings of solar installation for food firms

17-Mar-2009 - Last updated on 17-Mar-2009 at 15:17 GMT

Food and supplement manufacturing firms in the US are set to benefit more than ever before by installing solar panel energy systems at their facilities, as the benefits of tax cuts and grant programs start to take effect.

Under two separate moves by the US government, companies investing in solar energy are able to claim back 30 percent of the cost of material and installation.

In addition, solar panel systems or solar water heating would allow firms to improve their green profile – which has become increasingly important in the face of growing public scrutiny of companies’ environmental credentials.

Now Foods, which manufactures dietary supplements, natural foods and sports nutrition products, yesterday announced it has completed the installation of a new solar panel grid system.

The 7,095 watt solar energy system can generate around 10,358 kilowatt hours of electricity per year. This, said the company, will reduce its environmental impact by eliminating the release of 12,366 pounds of carbon dioxide, 18 pounds of nitrous oxide and 13 pounds of sulfur dioxide.

Solar incentives

Economic incentives for companies to install solar energy systems include tax cuts and grants, as well as financing and training options.

These fall under two government initiatives. The first – the Solar Investment Tax Credit – involves the extension of a federal tax credit, which allows for 30 percent of the cost of solar equipment and its installation to be deducted from a company’s tax liability.

This provision was due to expire at the end of last year, but in October 2008 the US House of Representatives passed a bill that would extend the credit for a further eight years.

In addition, since October 2008 the tax credit applies to a wider range of companies, as businesses that have a tax liability that triggers the AMT (alternative minimum tax) are now also eligible.

The second major piece of legislation that promotes solar panel installation is the stimulus bill signed in February this year.

President Obama’s American Recovery and Reinvestment Act of 2009 includes a grant program that would allow companies to apply for a grant to cover 30 percent of the solar equipment and installation costs, as an alternative to the tax credit.

Applications for the grant need to occur via the US Department of the Treasury, and guidance for the application process is expected within the next 60 to 90 days.

The stimulus package also includes other provisions that can benefit companies wishing to turn to solar energy. In total, there are 19 provisions that provide funding and financing options for investing in solar energy and for training.

To view a full summary of the stimulus bill’s provisions from the House Ways & Means Committee, click here .

Solar in the food industry

According to the Solar Energy Industries Association (SEIA) – the largest US trade group for solar energy – this type of energy is becoming increasingly popular in the food manufacturing industry.

“Solar water heating in particular is becoming more popular and has a lot of uses in the food industry for both heating and pre-heating application,” said SEIA’s Monique Hanis told NutraIngredients-USA.com.

To access more information on solar energy installation from SEIA, click here.