2024 was a tough year for Australian businesses. According to CreditorWatch’s November 2024 figures (1):
- Insolvencies rose a staggering 57% year on year.
- The average business failure and closure rate across all sectors reached 5.1%, the highest level since August 2020.
In even more sobering news, CreditorWatch predicts continued – and potentially increased – insolvencies in the first half of 2025.
But despite the tough economic environment, latest data from SunWiz indicates that businesses are still prioritising investment in their energy-efficiency. In fact, December 2024 was the best month on record for STC-Commercial (15 kW to 100 kW) segments with particularly strong growth in the 75 kW to 100 kW range (2).
Business owners are starting to recognise that investing in energy efficiency can be an effective way to mitigate rising operational costs.
With a challenging business climate and a growing appetite for energy efficiency, how should installers navigate the commercial market in 2025?
1. Target industries strategically
In the current market, it’s critical to carefully select the industries you target. Some sectors are faring worse than others.
According to CreditorWatch, Hospitality leads in business failure rates, late payments and ATO tax debt defaults over $100,000 (3).
Other high-risk sectors include (4):
- Administrative and Support Services
- Arts and Recreation Services
- Transport, Postal and Warehousing
- Construction
Businesses in these industries are likely prioritising short-term financial relief over longer-term investments in energy efficiency. They may also struggle to get an application for financing over the line, making them less than ideal prospects.
Instead, consider focusing on lower-risk industries. As of October 2024, the following sectors had the highest proportion of businesses rated as “low” or “very low” risk (5):
- Wholesale trade
- Manufacturing
- Agriculture, Forestry and Fishing
These industries not only have healthier financial outlooks but also stand to gain significant benefits from energy-efficiency upgrades. Data shows that Manufacturing is Australia’s most energy-intensive industry, while Agriculture ranks fourth (6).
With strong potential savings, relatively stable financial conditions and low-risk profiles, businesses in Manufacturing and Agriculture could be excellent prospects to target.
2. Avoid a one-size-fits-all approach
As Australia’s commercial decarbonisation market matures, appealing to a sophisticated customer and standing out from competitors will require you to be more strategic with your sales pitch. The generic “save money with solar” proposition, which may have worked in the past, is unlikely to resonate as effectively with today’s commercial audience
The key? Offer tailored, optimised solutions, not generic, one-size-fits-all packages.
Learn about the target industries you have selected and their specific business challenges and their commercial goals. For instance:
- Do they face high cooling, heating or processing costs?
- Is cash flow a significant concern?
- Are they planning to expand their operations or move into new markets?
- Are there any industry-specific rebates they could leverage?
Understanding these details allows you to propose the most suitable and compelling solutions.
3. Leverage trending products
A maturing market also brings opportunities in emerging subsectors. While the skyrocketing pace of solar PV adoption has slowed a little in the last few years, industry experts predict that we will see those steep trajectories in growth rates with heat pumps and batteries (7).
These technologies are becoming more affordable and better understood, driving increased demand. Concerns about grid stability (8) have further heightened interest in batteries, with many states rolling out rebates to support their adoption.
So, how can you capitalise on these growing markets?
- Bundle multiple equipment types
Don’t limit your customers’ potential savings – or your deal size – by selling just one type of equipment. Consider offering bundled packages, such as Solar + Battery or Solar + Heat Pump, at discounted prices to encourage adoption. - Revisit previous commercial solar projects
Look at your past commercial solar installations. Could these customers benefit from adding a battery to their system now?
4. Always offer finance
In the current economic climate, businesses are understandably being mindful of their cash reserves, so spending on a decarbonisation project may be lower on their list of priorities.
Yet, delaying their decarbonisation efforts keeps businesses drowning in high energy bills.
The solution? Investing in energy-efficiency equipment without any capital.
By using a Payment Plan or PPA to invest in energy-efficiency equipment, a business can reduce their exposure to electricity market volatility as well as save money without spending any of their own capital. In most cases, monthly energy-bill savings exceed the cost of repayments, resulting in a cash-flow positive position.
Helping business owners understand that a cash-flow positive position leaves money in their pocket each month can be an extremely powerful selling point in today’s business environment.
Despite the challenges in the commercial market, there are plenty of opportunities for installers who plan effectively and adapt to evolving customer needs.
By focusing on high-potential industries, offering tailored solutions, leveraging trending technologies and always selling the cash-flow benefits, you can take full advantage of growing demand within the commercial sector.
(2) https://www.pv-magazine.com/2025/01/15/australias-rooftop-solar-market-ends-2024-on-high/
(3) https://creditorwatch.com.au/blog/business-failures-at-highest-rate-since-peak-of-pandemic/
(4) ibid
(6) https://www.abs.gov.au/statistics/industry/energy/energy-account-australia/latest-release
(7) SunWiz, July 2024. 2024 Annual SunWiz Australian PV Report