Solar energy is a great way to cut your operating costs and reduce your carbon footprint. But how do you pay for the upfront cost of installing solar panels on your business premises? Fortunately, there are different financing options available for implementing solar energy solutions for your business, and SafEarth can help you find the best one for your needs.
SafEarth is a platform that connects businesses with the best renewable energy solutions in their area. It helps you compare quotes, choose vendors, and manage the entire project from start to finish. SafEarth also helps you explore different financing options for your solar energy project, such as loans, leases, and Power Purchase Agreements (PPAs). Here are some of the pros and cons of each option and some tips for choosing the right one for you.
Structure of a Solar PPA:
In a solar Power Purchase Agreement, a third party investor installs the solar system on your roof. They pay the whole cost of the installation, and also ensure the optimal operations. As a consumer of that power, you now agree to purchase the power produced from the plant for a fixed period of time (usually in the range of 15-25 years). This helps the investor in making a reasonable return on investment on the costs incurred for the solar system. The rate at which you pay for this electricity is usually a lot cheaper than the conventional grid power. This ensures that you are able to save money by reducing your electricity costs.
Win – Win right?
Let us look at the pros and cons of this mode of financing now.
The pros of using a PPA to finance your solar energy system include:
- You do not have to pay any upfront cost or interest for the system.
- You do not have to worry about the maintenance or repair of the system.
- You can save money on your electricity bills by paying a lower rate for solar energy than for grid electricity.
The cons of using a PPA to finance your solar energy system include:
- You do not own the system and cannot claim any tax deductions or rebates for it.
- You have to pay for the solar energy you use regardless of how much you save or need.
- You may have to pay extra fees or penalties if you want to end the PPA early or transfer it to someone else.
If you want to understand more about the different things to look at when adopting a solar PPA, then, have a look at this article here.
DIFFERENT THINGS TO UNDERSTAND IN A SOLAR POWER PURCHASE AGREEMENT (PPA)
At SafEarth, we are passionate about helping the world transition to renewable energy. This is why we have created the most customer centric platform for the adoption of clean energy. Sign up on our platform SafEarth today, to get the best value out of your switch to clean energy.
More Power to you!