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Distributed Energy
Solar Farm Project

Solar Farm Project

Gujarat, India.2020

20 %

IRR

6 years

Break Even Period

3.2 X

Target total return

20 years

Target investment period

Solar Farm Project

Gujarat, India.2020

20 %

IRR

6 years

Break Even Period

3.2 X

Target total return

20 years

Target investment period

Energy Customers Profile

This proposed solar farm project is intended to meet the energy requirements of several well established companies in Gujarat, India. 

Currently, funding is required for an 8000 kW solar farm in the state of Gujarat. This will be a ground-mounted solar system and the implementation of this solar farm project will allow the group of companies to off-set the use of power from the grid and reduce the energy paid to the electricity board. Based on the proposed installation capacity, the total system cost is $4,800,000. The solar farm will be constructed under a BOOT model. The lease duration is 20 years and the gross cost per unit is $0.08 without change for the full lease period. The annual energy generation from the solar system is an estimated 12,410,000 units.

Location

Power Purchase Agreement

How do distributions work?

In terms of monthly payment, the Energy Customers are only charged on the basis of power produced. Under the Power Purchase Agreements (PPA), parties involved agree to a lease for the full PPA period on a non-chargeable basis and also an O&M contract with Distributed Energy.  The lease period is 20 years and the degradation of the asset is 1% per annum – beyond the lease period, Distributed Energy will explore options of transferring the project to the Customer at a mutually agreed residual cost. The total investment percentage by the Energy Customers is nil. The maximum investment amount is $4,800,000.

 

Once the solution design is approved and arrangement of finance is finalised, the procurement of materials is initiated, followed by installation and commissioning of the project. A detailed timeline showcasing the breakdown of milestones and deadlines will be provided to the relevant parties.

What fees will I be paying to Distributed Energy?

Distributed Energy share, including O&M fees, is 20% of revenue generated monthly.

 

Why Invest?

The proposed project has a 20% return on investment with a target total return of 3.2x and break-even period of 6 years. Given that each of the Energy Customers have energy intensive day-to-day operations, there is a high, reliable demand for the energy that is to be produced from the solar farm. In addition to this, the group of Energy Customers that the PPA’s are to be signed with are established businesses, with high net working capital and healthy credit profiles.

From a clean energy mobilisation perspective, the implementation of this solar farm project will not only reduce the overall carbon footprint of the Energy Customers, but the percentage savings that they will be making over time as a result of this project implementation are substantial.

Investment Profile

Hypothetical Investment

$4,800,000

Total Returned

$15,520,119

Distributions Energy

*Note : All calculations and data presented are deemed to be accurate, but accuracy is not guaranteed. The projected pro forma IRR are intended for the purpose of illustrative projections to facilitate analysis and are not guaranteed by Distributed Energy or its affiliates and subsidiaries. Actual returns on investment may vary depending on tax, insurance and other increments.

Distributed Energy