Page 37 - Energize September 2021 HR

VIEWS AND OPINION

Upfront capital investment all offer loans for solar PV installations, with primary instruments being term loans, instalment sales
Companies able to fund their solar PV project agreements, asset and property finance, mortgage-backed business loans and access bonds.
from existing cash reserves may find the upfront The lending period for commercial installations ranges between five and ten years, while the
costs startling but the benefits appealing. collateral requirement for the debt funding is often taken against the underlying property and the
A medium-sized commercial system of system.
200 kWp currently costs between R1,9-million “The challenge with receiving finance from the banking sector is that since they don’t specialise
and R2,1-million, excluding battery costs. in solar PV ownership, the solar production risk will remain with you and your monthly repayments
Benefits to cash-funded systems include will be fixed, irrespective of the system’s performance. Further, you could be using up valuable credit
VAT deductions, as well as Section 12b tax lines with the bank,” asserts Alheit.
benefits and carbon credits, which can result in
additional cost savings of up to 28%. SolarAfrica’s PPA offering
“However, the business is also solely As the first company in South Africa to offer solar financing through PPAs, SolarAfrica provides a solar
responsible for all ongoing annual costs, finance solution through a PPA that enables business owners to reduce their monthly electricity costs
such as installation, insurance, performance by up to 40% and become more sustainable organisations, without having to pay any upfront capital.
monitoring and management, which can SolarAfrica’s fully-installed Tier 1 solar PV system requires zero capital investment, while the
amount to a minimum of R88 500 per year, agreement includes full maintenance, monitoring and insurance throughout the lifetime of the
along with exposure to the performance risk of agreement.
the system,” explains Alheit. With over 100 PPAs across local and multinational businesses, the company conducts a full
technical review to determine each client’s consumption trends, which ensures that the solar systems
Bank financing provided are customised to provide the best possible cost savings for each client.
Responding to increased interest by industrial All systems are monitored 24/7 to ensure optimum customer savings and any faulty or broken
and manufacturing energy consumers in equipment is covered and replaced at no cost to the client.
solar PV solutions, several local banks have “Not only do we offer a performance guarantee on all of our solutions, but the greatest
structured innovative finance agreements. advantage to SolarAfrica’s PPA is our ‘No Take, No Pay’ clause, which means you only pay for the
Absa, Nedbank, Standard Bank and FNB power you use,” says Alheit.

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