Financing

India’s solar sector has unlimited opportunities. However the major hurdle till date is the smooth financing of the projects in this field. Till few years back investments in solar were giving abysmally low returns as compared to traditional forms of energy and less compared to other forms of renewable energy like wind. The IRR (Internal Rate of Return) was one among the lowest and the payback period longest. This was one of the main reasons for a low level of interest in solar.


However things have changed drastically over the last two to three years for the betterment of this sector. The cost of setting up a solar plant has come down significantly. Thanks to the growing awareness and concern towards climate change, lot of investments have also poured in this sector. Consequentially the prices of solar cells, modules & BOS (Balance of Systems) have been on a downward trend for sometime now.


The National Solar Mission by the Indian government has also added a lot of impetus in this direction. To add to the spectacular growth, many state governments have pitched in with attractive & aggressive state solar policies.


But still, financing of Solar MW projects remain  a thorny issue with many developers. Even today, after such a steep decline in the prices of cells etc, the cost per MW is higher than other means of power. However the long term PPA’s (Power Purchase Agreements) are mitigating this downside factor and making these ventures if not more but at least as attractive as other energy sources.


We have a wonderful support of a group of investors who are always on a lookout for projects which are initated by enterprising individuals/companies backed by good numbers in the solar sector. If the project is of interest, the support can be in form of debt or equity or in some cases a combination of both. These investors are  a motley group of prominent PE players, HNI’s and some progressive companies.


Our own experience in this field helps us to give indepth advisory on organizing of project finance for your project and make it an attractive proposition to the potential investors.


 
   

 

 
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