Electricity Saving Tips For Homes And Offices

Guest Post: Financing Options for Solar Rooftop Projects in India

By on November 5, 2016

Solar power is experiencing rapid growth in India, powered by a variety of recent developments: central and state governments have been announcing policy initiatives to drive adoption, solar power is already at grid parity for SME & industrial customers in 12 states, and cost of grid power is increasing by 5 – 10% every year for almost all customers. Combined with environmental concerns and widely prevalent power deficits across the country, going solar should be top of mind for everyone.

However, despite compelling long-term benefits and positive environmental impact, we haven’t seen solar adoption going viral, especially among rooftop owners. Customer awareness and high capital costs are the largest hurdles in today’s marketplace.  Given the rapidly changing environment, rooftop owners often lack clear, up-to-date, information. Bijli Bachao has previously produced an excellent guide to buying rooftop solar in India, here:

This video provides an overview of a rooftop solar system, tells you about the types and cost of such systems. It also provides information about additional factors that you should think about like system size, and how much roof space will it need.

The high initial cost of solar is becoming easier to address. For residences, housing societies, and small commercial establishments, loans are available at low EMIs under MNRE directive to banks to treat rooftop solar as a priority sector for lending. For establishments with large electricity consumption (>10,000 kWh a month), pay per unit financing deals are becoming available. Under such contracts, a third party owns the solar installation, and the roof owner enters into a long-term (10-20 yrs) agreement to purchase power generated by the system at a set rate. Capital cost to the owner is zero, they pay only for power used from the system and save from day-1. Some companies are offering leasing models, which are somewhere in between the two stated above. However, the market is changing quickly, and it is not easy to avail these schemes. Loan products are still evolving, and PPA and leasing models for rooftop solar are in nascent state.

Will a rooftop solar system save me money?

A key question that most potential buyers have is: will a rooftop solar system save me money? Of course, the answer depends on the type of connection, state and amount of usage. Let’s look at a couple of examples.

First, consider a small urban household that consumes 10 units (kWh) of electricity daily, with a 2 kW system installed on the roof.  In 2015, this system would cost approximately INR 2 lakh to install. The lifetime of a typical solar system is 25 years. So, the system costs INR 8000 per year. A 2kW system should comfortably provide 8 units (kWh) of electricity per day.  At INR 4 per unit, the monthly electricity bill goes from INR 1200 to INR 240, saving INR 11520 annually on electricity costs, and INR 3520 annually net of system cost.

If you were to use financing for a rooftop solar system, you would be saving money net of EMI within a few years. Shown below is a payoff curve (net of EMI) for a 10KW system in Bangalore, financed with a 5 year loan at 10.75% interest rate.

Oorjan1

It is important to note state and central government incentives are not factored into the calculation above. A profitable corporation can take advantage of accelerated depreciation benefits (writing off 80% of system cost in year 1) on their tax return. For solar loans to individuals and SMEs, MNRE is spending funds on lowering interest rates on loans. Lastly, while subsidies are available for rooftop solar from central and state governments, they are difficult to get as there is a priority list for approval. MNRE has advised people to set up rooftop projects without waiting for subsidies given constraints on availability of funds.

Oorjan Cleantech (http://oorjan.com), India’s first rooftop solar financing platform, can help you solve the capital cost hurdle. If you already have a price proposal and project design from an installer, send it to us for evaluation and financing. If you are just getting started, we can help you choose a highly rated local installer and obtain financing. Loan approvals for EMI schemes typically take 2-3 weeks, while pay-per-unit agreements take upto 6 weeks. We also provide a user-friendly app to monitor system performance once your project is installed, and provide periodic alerts. Contact  us if you have always wanted to go solar, have questions and/or money was in the way!

This post is a guest contribution by Oorjan Cleantech, a company that enables solar rooftop financing. It is an initiative by Alums of IIT Bombay having years of experience in Solar PhotoVoltaic Markets. They have an estimator and contact form on their website www.oorjan.com.

Recommended Content

  • Ankit Singh

    We are an Solar EPC company and we can provide

    solar Rooftop system

    -On grid(with net metering)

    -Off grid(with battery)

    Solar street light 15w to 65w

    solar water heater and etc.

    contact me at askmesolar@gmail.com

    or call / Whatsapp +91-9953384191

  • Abhinandan Choudhary

    We are an Solar EPC company and we can provide

    solar Rooftop system

    -On grid(with net metering)

    -Off grid(with battery)

    -Solar street light

    -solar water heater etc.

    contact me at achwsvsolar@gmail.com

    or call +91-7042435795

  • Vishal

    DBG Green Solution has successfully commissioned more than 150 MW installations in Transmission, Distribution and Renewable Energy in India with a track record of technology leadership, project execution excellence, world class safety processes and customer oriented services

    For MW Scale solar projects, Rooftop Solar Projects in Maharashtra.

    Plz Mail…dbggreensolution@gmail.com

  • Nilesh

    We want subsidy for solar panels how to? njethva7@gmail.com

  • Ankit Singh

    We are an Solar EPC company and we can provide

    solar Rooftop system

    -On grid(with net metering)

    -Off grid(with battery)

    Solar street light 15w to 65w

    solar water heater and etc.

    contact me at askmesolar@gmail.com

    or call +91-9953384191

  • Abhinandan Choudhary

    We are an Solar EPC company and we can provide

    solar Rooftop system

    -On grid(with net metering)

    -Off grid(with battery)

    Solar street light

    solar water heater and etc.

    contact me at achwsvsolar@gmail.com

    or call +91-7042435795

  • Ankit Singh

    We are an Solar EPC company and we can provide

    solar Rooftop system

    -On grid(with net metering)

    -Off grid(with battery)

    Solar street light 15w to 65w

    solar water heater and etc.

    contact me at askmesolar@gmail.com

    or call +91-9953384191

  • vinay kumar

    Career in Solar Industry as a solar installer …………………………. 3 Days Solar Training by Professionals starting from 15/06/16 in Delhi ……….Register Today
    Contact: : 9312700996….

  • Devadas Krishnan

    Hi, I am constructing a house on Kerala with good plinth area. I am planning to install solar with an eye on net metering. I’d like to hear from anyone here on their experiences on net metering as well as installation. Plus is there any hindrances to secure subsidy on net metering projects?

  • Gaurav

    We are an EPC company, contact us for the solar power plant installations, Emial : gauravkumarraheja@loyalprices.in, contact : 7307420111

  • Rajesh Nadar

    I am looking for solar panel ranging from 5-25W with aluminium frame. I am planning to work on a project – which would require solar panel both single(mono)crystalline and polycrystalline solar panels. If my project works out – I would be able to place order in bulk. I am currently in chennai. If anyone knows solar panel companies in Chennai, Tamil Nadu, India which sells best panels with certification. Please reply to this post and give me your email contact details.

    • Rahul Pal

      We deal in Solar PV Installation providing end to end Solution right from the Planning to commissioning. We have Installed Solar PV at Pan India level. As Market is flooded with Bad quality panels , it becomes essential to buy certified Panels. Feel free to give me a call at 977354397 to get the PDF guide for Solar panels.

  • VINAY KUMAR

    Join The Solar Industry Today
    Admissions open for Solar Training New Batch Starts Soon
    Contact:
    9312700996

  • POOJA

    Hi Abhishek I am planning to buy AC staying in Mumbai , 1.5 ton 3star in Voltas can u suggest some good option . Budget is 30k

    • https://www.bijlibachao.com Abhishek Jain

      You can look at any of these:

      Voltas 183 CYE
      Voltas 183 DYA
      Voltas 183 EY-R
      Voltas 183 EYI
      Voltas 183 MYC
      Voltas 183 CY

      They all have same energy efficiency and may fit in your budget.

  • Base Solar System

    Hi everyone, we are from Nuapada district of Odisha giving services on Solar power system for lighting, agriculture water pump, etc. We procure all MNRE approved high quality materials from renowned & reliable manufacturers, integrate into best system for trouble free service at the most competitive rates — BASE SOLAR SYSTEM, email : rahulagr@gmail.com ; cell 9437070553

  • kishan patel

    What about subsidy from MNRE. IS it available or not.

    • https://www.bijlibachao.com Abhishek Jain

      Not really.

  • Bikash

    Solar power solution for reducing electricity Bills. Install anywhere in India. reach us at surya.group022@gmail.com (7504647207)

  • Abhishek Chaturvedy

    Hello ,
    I am from Kolkata. I would like to know , how a common man can start using Solar Panels. Total Cost and from where to purchase the required tools.

    • Drishti Solar

      Hi Abhishek, This is Shankhadip, CEO of Drishti Solar, KOlkata based Solar company. I would like to help you. Our mission is to provide exact service what you are looking for. We are trying to make solar energy affordable and available for normal people and looking at privately held property like normal household, school, colleges, mall, hotel, factory, showroom etc and have started our journey. We would like to talk with you once and if possible please provide us your contact details so that we can reach to you and give you the proper explanation over this. My contact details are +91-9038633211 and drishtisolar@gmail.com.

      Looking for your response and co-operation.

      Regards,
      Shankhadip
      CEO, Drishti Solar Pvt Ltd
      drishtisolar.com

  • TunaFish

    For solar powered residences to become mainstream, we need some breakthrough in battery technology. It’s not the cost of solar panels that acts as an entry barrier since even middle class families can afford to spend 2-3 lakhs on panels considering they last for 25 years. But batteries….they are expensive and they need replacing every 1-1.5 years and that’s a big no-no for most people. It completely nullifies any amount that you would have otherwise saved over the long term.

    With grid power costing close to Rs. 9/unit in West Bengal, solar panels are a no-brainer if the government can introduce Grid-assisted solar power systems with net metering to eliminate the need for battery.

  • Vivek

    Hi, Can we place the solar panel on the wall as we place LED TV on wall ? Because i live in a flat in Pune. My gallery is in South direction and there is enough solar direct rays on the outer walls of gallery. please suggest the cost of solar system as my monthly electricity bill is around INR 800.

    • http://www.oorjan.com/ Team Oorjan

      Hi Vivek, for Pune the optimum tilt is 22° for a south-facing panel. If you install the same panel vertically (ie at 90°) facing south, the average yearly output will drop to about 45% of the optimum so you will need to install more than twice the number of panels for the same desired output. Since panels are typically 45% of the system cost, you are looking at at least 155% of a standard system price if you go this route.

    • https://www.bijlibachao.com Abhishek Jain

      Hi Vivek,

      For a solar PV to give best (most) output, it has to directly face the sun. In fact the more sophisticated systems have sun tracking device that makes sure that solar PVs are moved automatically so that they track the sun. If you put it on the wall just like a LED TV panel, then its output will decrease significantly. By how much? well that will have to be calculated.

  • Ajay

    Hi, I am from Mandya(571401), Karnataka. i would like to know is net metering is introduced in Mandya, if so what will be cost for solar panel for Roof size 1200 SqFt, subsidy, etc and guide me further steps or give me contact person who can help me in this regard.
    Thanks in Advance.

  • Sreenivasula Reddy M V

    Hi, Im located in K R Puram, Bangalore. My house area is more 500sqft (available on roof) and I’m having Inverter for my house (900W). My monthly Electricity bill is around 350/ to 400/- Rs. How much capacity will be recommended for Net metering On Grid and also which distributor will be suggested to take the project.

  • Sunil K jain

    Please let us know how to get it financed.

    • https://www.bijlibachao.com Abhishek Jain

      I would suggest you to take help from Team Oorjan. This is the link to their wesbite: http://www.oorjan.com/

  • hroli

    Thanks Bijli Bachao team. Look forward to helping the readers on the forum!

Top