Financing Options for Solar Power Projects
The government around the world is encouraging the adaption of solar energy for daily electricity purposes. Solar Panel is one of your most efficient investments. They are durable and energy-saving and offer the best alternative to coal power. Solar Energy being the most reliable and environmentally friendly source of energy, gives you the maximum output for your investment. To harness maximum solar energy, solar panels are installed on the rooftop, in an open area where it can receive maximum sunlight.
While solar is the most convenient energy source, switching to it from the conventional energy source might not be feasible. While energy from the sun is free, manufacturing the solar plants with an MW level of capacity, its equipment and the installation is expensive. While the sun’s energy is free, building a solar plant with an MW level of capacity is expensive. Finding funding options is one of the most difficult challenges facing investors in the solar energy sector.
Financing Options For Solar Plants
In the foreseeable future, there are numerous ideas to obtain energy from carbon-free sources in order to maintain energy sustainability on the planet. Now that you are aware that renewable energy sources are an expensive production, it is obvious that the cost of installation will also be enormous. So it becomes sensible to search for a reliable financing system. Let’s explore a few financing options for solar energy:
Private bank Financing
Of course, banks are the most convenient place to finance your solar plant projects. Private banks offer numerous schemes to take loans at affordable rates. Of all, the banks are the only ones that can assist you in funding such enormously vast investment projects. Of all, the banks are the only ones that can assist you in funding such enormously vast investment projects. Many private banks show interest in financing solar-related projects. Of course, the procedure could take a while, and you’ll need to meet the prerequisites and go over the project model in great detail.
A few companies are willing to offer third-party solar PPAs (power purchase agreements) as a way to finance the projects. Of course, one must carefully review the small print to see if the pricing structure appears to meet their demands. You can also take advantage of the solar investment tax credit if you run a non-profit utility.
You can easily add solar to your commercial place with the help of affordable monthly costs, which enable you to start spending less on your electricity than ever before. Monthly or periodic payments are much more convenient than paying all at once. This way you don’t have to bear high installation costs and make monthly affordable payments.
Owning a solar power plant is unquestionably one of the finest methods to get your energy needs sorted. You would, however, undoubtedly need to be loan eligible. Some of the major banks may be interested in approving your loan if your project is good enough. You should be good to go if you have the best credit history and the appropriate documentation.
To encourage the use of solar energy in India and meet the goal of 100 GW of power usage, the Indian Ministry of New and Renewable Energy (MNRE) has introduced a number of Central Financial Assistance (CFA) initiatives. Through this, the government will give solar panel subsidies to businesses that are fueling growth.
The Indian government has come up with various solar panel schemes to provide to the enterprises that are promoting growth, like:
CFA totaling INR 2 M/MW or 30% of the project’s cost. This also includes grid-connectivity costs.
Additionally, INR 2.5 M per plant is also availed for conducting surveys and preparing Detailed Project Reports(DRPs)
Is it possible to get low-interest solar financing?
This is a possibility if the solar financing comes from outside sources, especially if the components are also imported from a lending nation. If the project is funded internationally, interest rates, including hedging, are predicted to range from 8 to 10%. Funding, which typically covers the panels, would only pay a part of the project’s costs.
In order to employ renewable and sustainable resources, a higher level of attention and a more action-oriented policy structure are required. As part of the National Action Plan on Climate Change, the Indian government has adopted a number of eco-friendly and environmentally sound policy initiatives, under which various funding options to finance solar power projects will be introduced.
Solar91 is leading in terms of manufacturing solar panels and other systems related to solar power systems. Contact us for more information regarding rooftop installations, solar inverters, solar street lights, etc.