Lessons from the Past…….for betterment of FUTURE Solar Project

Lessons from the Past…….for betterment of FUTURE Solar Projects

Based on the experience of implementation and strategic consultancy for variety of solar projects, ranging from 1mw to 20mw grid connected Solar PV Projects.

Solar PV project implementation is a very complex mix of activities, including :

-Documentation,

-Timely submission and paper work,

-Govt. approvals,

-Planning,

-Designing,

-Land selection,

-Best mix of equipments and vendors,

-Engineering

-Financing etc.

Developers has to remain very alert about updates, since decisions at every stage is very crucial and important to life of the solar project, efficiency for 25 years generation, return on investment, performance ratio, operation & maintenance etc.

Solar Project success depends on raw material (Sun Rays) and accurate calculation of availability of solar radiation is very important. This can be classified under Resource Assessment and selection of optimum suitable location. Then decision regarding equipments, vendor, guarantee, warranty etc. has to be taken in proper decision matrix. After generation of power, it is essential to have proper planning for power evacuation and power transmission. This depends on synchronization between developer’s system and government transmission facilities. Any adverse situation or non-synchronization shall result in direct revenue loss to the developer.

Expertise of developer’s team / consultant (owner’s engineer) shall be into right mix of technology, right mix of equipments, right mix of local situation, right mix of own system and government system. All these factors are more important, rather just opting for a Turnkey Contractor or EPC company on lowest price quotes. Since accurate project planning is going to survive your solar project for the life of 25 years operations and revenue and business interest of Turnkey Contractor or EPC is limited upto the commissioning of your solar project. It is crucial to make prudent investments after incorporating risk control measures.

In the interest of Solar Power business development in India………………

Authored by :

CA Yogesh
Director
BWPM Co.

visit us at : www.Yogesh-CA.blogspot.com

Financing of Solar PV projects in India

Financing Solar PV Projects in India:

Solar Projects installations in India begin in year 2008. Most of the projects are located in the State of Rajasthan and Gujarat. Indian solar market is regulated by Government FIT, Own consumption and REC mechanism.Financing a Solar PV project is a challenging job for any financial consultancy firm. Wherein following options may be availed:

• Corporate Financing
• Lease Financing
• Project Financing

Decision Matrix criterions for Lender institutions……Screening of a Solar PV project:

Following parameters to be simulated for minimum DSCR for different FIT and irradiations.

• Calculation of minimum promoter’s equity required to achieve minimum DSCR
• Calculation of maximum Capex required to achieve minimum DSCR.
• Light business approach with minimum DSCR as key parameter
• Maturity 5-8 years
• Standard down payment 20%-30%
• Mandatory insurance coverage as per banking policy
• Mandatory O&M agreement
• Due diligence by external appraisers
• Performance monitoring agency

How do we structure debt/equity deals for our clients:

• Screening of EPC contracts with various standard and subjective parameters
• Screening of Govt. schemes and FIT regulations
• Payback calculations with FIT, Depreciation benefits, Cost of Debt, Equipment sourcing etc.
• We validate each transaction with a separate financial evaluation team representatives.
• Project financing bankable set of finance contracts with a set of covenants as standarised by Banks and Rating agencies.
• Financial Model goes through several audit checks.

Authored by :

CA Yogesh
Director
BWPM Co.

visit us at : www.Yogesh-CA.blogspot.com

Anti-dumping duty on Solar cells and modules in India

India might impose anti-dumping duty on four major importers of Solar Cells and Solar Modules in the country after listening to the grievances of domestic manufacturers.

Local producers have filed a case last year, alleging that countries such as the USA, China, Malaysia and Taiwan were exporting solar equipment to India at "ridiculously low prices" which was "bleeding the local industry".

Authored by :

CA Yogesh
DirectorBWPM Co.

visit us at : www.Yogesh-CA.blogspot.com