Following are few ways to invest in solar power plant:
-As an Equity investor as a consortium member along with Solar Plant Developer (SPD) by providing cash or liquid assets in
- Solar plant won in government (MNRE,SECI, NTPC,state government) auction
- Solar plant having signed PPA with high credit rated third party buyer
-As an Asset sponsor to raise debt if you have residential, commercial or industrial property or land assets without any other lien or encumbrances then you can charge SPD some percentage upfront and/or annually or ask for equity
-Set up solar plant yourself by contracting a consultant or EPC by chipping in complete equity and raising debt against your assets
But, you need to understand few basic things before moving ahead:
For 1 MWp solar power plant
- installed on 5 acre land
- generates 15,00,000 kWh (Maharashtra) to 17,00,000 kWh (Rajasthan) per year depending on your geographical location
- at Rs. 4 crores (excluding land cost, right of way & liaosoning)
- funded at 70: 30 debt: equity
- banks do not give non-recourse funding and borrower has to mortagage other assets along with solar plant for the loan. The bank asks for signed PPA with offtaker of generated electricity before proceeding with loan request
- 40% accelerated depreciation benefit under IT section 32
- for capacity below 500kWp, capital subsidy of 30% or Rs 18/Wp whichever is lower for solar plant if it is set up for captive or for self-consumption of residents, trusts, schools, colleges, temples, hospitals,etc. No subsidy is available for commercial and industrial consumers or solar plant set up for trading electricity
- You can sell electricity to state electricity utilities (most utilities purchase at Rs 3/kWh)
or
- sign a PPA with third party buyer (industrial/ commercial/institutional having contracted load of more than 1 MW) under OPEN access but you have to pay utility (Rs. 2.5/kWh to Rs. 4/kWh) for using their grid infrastructure as css, wheeling, transmission, special surcharge, electricity duty, etc