Rising energy costs are squeezing retail businesses everywhere. Commercial buildings are energy hogs, accounting for over 18% of total U.S. electricity consumption. Each year, business owners spend over $190 billion on energy. For retailers, these numbers are even more striking. Retail/Big Box stores consume 189,000 kWh annually (based on 13,500 square feet) — nearly double the energy usage of typical warehouse operations.
At the same time, consumer expectations for environmental responsibility are higher than ever. Shoppers increasingly choose brands that demonstrate a commitment to sustainability. This convergence of rising energy costs and environmental consciousness has created a perfect storm that’s driving smart retailers toward solar power.
Solar energy offers retail businesses a practical path to slash operating expenses while meeting consumer demands for environmental leadership. Unlike other sustainability initiatives that require ongoing investment, solar panels generate revenue through energy production and cost savings. The numbers speak for themselves: At the IKEA store in Baltimore, installing solar panels on the roof and over the store’s parking lot cut the amount of energy it needed to purchase by 84%, slashing its costs by 57% from September to December of 2020.
In this guide, you’ll discover how solar-powered retail works, explore real success stories from major retailers, understand the financial benefits, and learn the practical steps to implement solar energy in your own retail operation.
What Is Solar-Powered Retail?
Solar-powered retail shows a shift in how stores generate and manage their energy needs. Rather than relying entirely on grid electricity, retailers install solar panels to capture sunlight and convert it into clean electricity that powers their operations directly.
The Three Main Approaches
Rooftop Solar Systems are the most common installation type for retail businesses. Target stores across America have more than 240 million square feet of rooftop space that could be used for solar. Solar on the roofs of all Target stores could produce enough electricity to power more than 250,000 average American households. These systems take advantage of the large, flat roof spaces that characterize most retail buildings.
Parking Canopy Solar offers a dual benefit by protecting customers’ vehicles while generating clean energy. Target has rolled out one of the most visible displays of its efforts to become a greener company: Massive carports topped with solar panels that will power a big-box store in California. The panels, high above the parking lot, will produce enough renewable energy to power the entire store, from its refrigeration to its heating and air conditioning.
Ground-Mounted Arrays work well for retailers with additional land space. These systems can be positioned optimally for sun exposure and are easier to maintain than rooftop installations.
How Solar Works for Retail
The process begins when photovoltaic panels capture sunlight and convert it into direct current (DC) electricity. Inverters then transform this DC power into alternating current (AC) electricity that your store’s electrical systems can use. Any excess energy can be fed back into the electrical grid through net metering programs, earning credits on your utility bill.
Modern commercial solar systems are designed to handle the unique energy demands of retail operations. They can power everything from lighting and HVAC systems to refrigeration units and point-of-sale equipment. Rooftop solar generates enough energy to meet 15% to 40% of Target properties’ energy needs, though some installations can cover 100% of a store’s energy requirements.
Scale Considerations for Different Retail Types
Small boutiques usually need 20-50 kW systems, while big-box retailers might require 200-500 kW or larger installations. Retail/Big Box: 189,000 kWh annually (based on 13,500 square feet) demonstrates the energy demands that larger retail spaces must address. The system size depends on your energy consumption patterns, available space, and financial goals.
The Business Case for Solar in Retail
The financial advantages of solar power for retail businesses are multifaceted. Understanding these benefits helps explain why major retailers are making investments in solar infrastructure.
Dramatic Energy Cost Reduction
Commercial buildings spend $1.44 per square foot per year on electricity, which translates to big annual expenses for retail operations. Solar power directly reduces these costs by replacing expensive grid electricity with free solar energy. Most solar power systems pay for themselves within five to 10 years, depending on the size of the system and overall power needs. After that, the power a solar system generates is essentially free for the rest of the lifetime of the array.
The savings can be substantial. By installing solar panels on two California stores, Costco reported savings of $300 per day on average over three months. For a typical retail operation, this could translate to annual savings of tens of thousands of dollars or more.
Strong Return on Investment
With an average ROI of 13.52%, Solar energy consistently outperforms traditional investments, such as stocks on the S&P 500. Commercial solar systems typically provide an annual ROI of 10-15%, making them a smart long-term investment for businesses seeking to reduce operational costs and improve sustainability.
Payback periods are equally attractive. The average payback period for commercial solar panels is 10.43 years with an average system lifespan of over 30 years. This means retailers enjoy two decades or more of essentially free electricity after recovering their initial investment.
Predictable Energy Costs
One of solar power’s most valuable benefits is energy cost predictability. Traditional electricity rates fluctuate with market conditions and regulatory changes. For a majority of utility customers in California, businesses included, the average commercial retail price of electricity has increased on average by about 3.5% per year from 2001 to 2020. However, after global events in 2020 such as the coronavirus pandemic, rates through 2023 have risen much higher than previous averages. Some customers are paying annual increases as high as 23%.
Solar systems provide protection against these rate increases by generating a fixed amount of energy at a known cost over the system’s lifetime.
Powerful Tax Incentives and Financing
Federal and state incentives improve the financial equation. Using the Solar Investment Tax Credit means If you install a system under the size of 1 MW, the federal tax credit returns 30% of the system’s installation cost to you in the form of a federal tax credit.
Additional incentives include:
- Accelerate Depreciation: With bonus depreciation on your solar equipment, you can choose to accelerate 40% of the tax savings from the depreciation of your solar system
- USDA Reap Grant: The USDA REAP grant, available to qualifying rural small businesses, supports energy-efficiency improvements and renewable energy projects by covering 25% or 50% of installation costs
- Various state and local incentives that can further reduce upfront costs
Property Value Enhancement
Solar installations increase commercial property values by reducing operating expenses and demonstrating environmental responsibility. Properties with solar systems often command higher lease rates and sale prices due to their lower operating costs and enhanced sustainability credentials.
Real-World Success Stories
Major retailers across the country are proving that solar power delivers real results. These success stories demonstrate the practical benefits and financial returns that well-planned solar installations can provide.
Target: Leading the Solar Revolution
Target is the top corporate installer of solar power in the USA with 147MW installed on 300 stores. The retailer’s commitment to solar power extends past cost savings to sustainability leadership.
Target’s Vista, California location showcases the future of retail solar. The Target location in Vista, Calif., about 40 miles north of San Diego, has become the company’s most sustainable store — and could become a national model for the retailer. This store produces as much energy as it consumes, demonstrating that net-zero energy retail is achievable.
The company’s ambitious expansion plans include 100 stores and distribution centers for solar installations, showing their confidence in solar’s financial and operational benefits.
Walmart: Massive Scale, Massive Impact
Walmart has at least 142 MW of total on-site installed solar capacity. The retail giant’s solar installations span multiple states and demonstrate how large-scale retailers can leverage their roof space for energy generation.
The potential for expansion remains enormous. 9 out of 10 Americans live within 10 miles of a Walmart. If Walmart stores had rooftop solar and energy storage, stores could have power even when the grid is down. This would provide critical community resilience during emergencies while generating cost savings.
IKEA: Solar Success Across 90% of Locations
Ikea has installed solar on 90% of its retail locations. The Swedish furniture retailer’s solar adoption demonstrates how international companies can successfully implement solar across diverse climates and markets.
IKEA’s Baltimore Results: installing solar panels on the roof and over the store’s parking lot cut the amount of energy it needed to purchase by 84%, slashing its costs by 57% from September to December of 2020. These savings show the potential of well-designed solar installations.
Small Business Success
Solar success isn’t limited to retail giants. Nubs Plastics in Vista, CA is a plastics manufacturer that offset 41% of their energy use by covering their roof with commercial solar panels. Rather than high-rated alternatives, Revel fit almost 700 panels into the available space using only 375W rated panels. With the new 260kW system, Nubs can expect their investment to produce $4.2 million dollars of electricity over the life of the system.
While this example comes from manufacturing, the principles apply equally to retail operations. Smaller retailers can achieve substantial savings on their energy bills through properly sized solar installations.
Industry-Wide Growth
The commercial solar market, which consists of on-site solar installations for businesses, non-profits and governments, has historically been dominated by a handful of markets: California, Massachusetts, New Jersey and New York. Q1 2025 was the segment’s strongest first quarter in history, and installed nearly 500 MW.
This growth reflects increasing recognition of solar’s business benefits across retail and other commercial sectors.
Implementation Considerations for Retail Businesses
Successfully implementing solar power requires careful planning and attention to multiple factors. Understanding these considerations helps ensure your solar installation meets your business needs while maximizing financial returns.
Roof Assessment and Structural Requirements
Your building’s roof is the foundation of most retail solar installations. Professional structural engineers must evaluate your roof’s ability to support additional weight from solar panels, mounting hardware, and potential snow loads.
Key factors include:
- Roof age and condition – Solar systems last 25-30 years, so your roof should have a remaining lifespan that exceeds your solar payback period
- Weight capacity – Most commercial roofs can support solar installations, but verification is essential
- Roof material – If installed on a roof, the type of material the roof is made of – standing seam metal vs. a flat rubber surface affects installation complexity and costs
Space Optimization and System Design
Retail buildings have to balance solar panels with other rooftop equipment like HVAC units, exhaust fans, and signage. Professional solar designers use computer modeling to optimize panel placement for maximum energy production while maintaining access to existing equipment.
Design considerations include:
- Spacing around HVAC equipment for maintenance access
- Shading analysis to identify the most productive areas
- Fire safety setbacks required by local codes
- Aesthetic considerations that maintain your brand image
System Sizing for Retail Energy Patterns
Retail businesses have unique energy consumption patterns that influence system sizing. Retail buildings have an average EUI of around 80 kBtu per square foot per year. Lighting is intensive for visual merchandising, and HVAC has to provide comfort for customers.
Energy considerations include:
- Peak demand during business hours aligns well with solar production
- Year-round operation requires systems that perform in all seasons
- Lighting and HVAC represent the largest energy consumption categories
Maintenance Requirements and Access
Your solar panel installation will still be saving you money a quarter of a century after installation. However, proper maintenance ensures peak performance throughout this lifespan.
Maintenance needs include:
- Annual professional inspections
- Panel cleaning to remove dust, debris, and bird droppings
- Inverter monitoring and potential replacement after 10-15 years
- Vegetation management for ground-mounted systems
Aesthetic and Brand Considerations
Solar installations should complement rather than detract from your retail brand image. Modern solar panels offer sleek, professional appearances that can enhance property aesthetics.
Design options include:
- Black panels and mounting hardware for a uniform appearance
- Strategic placement to minimize visibility from customer areas
- Integration with architectural elements like canopies or awnings
- Consider customer perception and marketing opportunities
Overcoming Common Retail Solar Challenges
While solar power offers benefits for retail businesses, several challenges require thoughtful solutions. Understanding these obstacles and their solutions helps create successful project implementation.
Addressing Initial Investment Concerns
The upfront cost of commercial solar installations can seem daunting. Total commercial solar panel cost varies based on system size, equipment quality, and site conditions, including roof integrity and electrical infrastructure. However, multiple financing options make solar accessible without large cash outlays.
Financing solutions include:
- Power Purchase Agreements (PPAs) – Pay for solar energy rather than owning equipment
- Solar loans – Spread installation costs over 10-20 years with monthly payments often lower than energy savings
- Solar leases – Similar to PPAs but with fixed monthly payments
- Cash purchases – Maximize incentives and long-term savings for businesses with available capital
When combined with federal and state tax credits, this can reduce the total cost of a solar installation by up to 60%. These incentives significantly improve the financial equation for solar investments.
Roof Complications and Infrastructure Challenges
Retail buildings often have complex rooftop equipment that creates installation challenges. Experienced solar installers work around existing HVAC systems, exhaust fans, and other equipment while maintaining proper clearances.
Common solutions include:
- Custom mounting systems designed for specific roof configurations
- Ballasted mounting systems that don’t penetrate roof membranes
- Strategic panel placement that preserves equipment access
- Coordination with roofing contractors for optimal integration
Matching Solar Production with Retail Energy Patterns
Most retail businesses operate primarily during daylight hours, which aligns well with solar energy production. However, energy storage can optimize this match further.
Energy optimization strategies:
- Size systems to match daytime energy consumption
- Implement time-of-use rate strategies to maximize savings
- Consider battery storage for energy shifting and backup power
- Use smart energy management systems to optimize consumption patterns
Ensuring Easy Maintenance Access
Retail solar systems require periodic maintenance to maintain performance. Commercial solar panels usually have a 25 to 30 year (or more) lifespan. Reputable manufacturers provide a solar panel warranty for around 25 years, ensuring a minimum efficiency level.
Maintenance considerations include:
- Design systems with adequate spacing for cleaning access
- Establish maintenance schedules that don’t interfere with business operations
- Work with installers who provide comprehensive warranty coverage
- Consider service agreements that include routine maintenance
These challenges are surmountable with proper planning and the right installation partner. The key is working with experienced professionals who understand retail-specific requirements and can design solutions that address your unique circumstances.
Take the Next Step Toward Energy Independence
Solar power is more than just an energy solution for retail businesses—it’s a strategic investment in your company’s financial future and environmental leadership. Retailers across the country are achieving cost savings and improved profitability through well-planned solar installations.
The time to act is now. The federal tax credit could be disappearing soon. Every month you delay means continued exposure to rising energy costs and missed opportunities for savings. Some customers are paying annual increases as high as 23% in electricity rates, making the predictable costs of solar power even more valuable.
Your Path Forward with 8MSolar
At 8MSolar, we understand the energy challenges facing retail businesses in North Carolina. Our team combines solar expertise with practical knowledge of retail operations to design systems that maximize your return on investment while minimizing disruption to your business.
Our approach includes:
- Detailed energy analysis to optimize system sizing for your specific needs
- Professional roof assessments and structural engineering
- Custom designs that integrate seamlessly with your existing operations
- Complete project management from permits through commissioning
- Ongoing monitoring and maintenance support to ensure performance
We’ve helped countless businesses achieve energy independence through solar power, and we’re ready to help you join the growing number of retailers who are cutting costs and going green.
Don’t let rising energy costs continue to erode your profitability. Take control of your energy future with solar power from 8MSolar. Your bottom line—and the environment—will thank you.