While going in for a major investment like solar, as a property owner, you are bound to have your apprehensions! But fear not, solar is a major fast-growing industry and you are right in time to join the clean energy movement.
While the sun may be shining bright for the solar industry in general, if you have opted to go solar, it will shine bright for you too!
India’s installed solar capacity reached 20GW in February 2018, making it 4 times larger compared to 2650 MW in May 2014. With plenty of financial benefits and schemes now available, it is a lot easier to push aside these financial apprehensions easily!
Installing a photovoltaic system, better known as a PV system, is done with the objectives of saving our environment and saving our income.
For those of you wondering about what you will gain financially by the installation of a solar system, here are the top.
The most direct benefit is the drop in your electricity bills that you will notice. By switching to solar, you are no longer buying electricity from the grid. By generating even a portion of your electricity consumption from solar energy, you save big and have significantly lower prices on your electricity bills. Using solar will enable you to move to a lower slab, drastically cutting down your cost of electricity.
If you consider net metering, you can get credit for the excess energy you generate which you can trade with the grid. Net metering is a financial boon to residential users as your solar installation might not always generate electricity exactly as per your needs. Factors such as time of the day, season, or shadows may influence a generation. Hence you can exchange the excess generated energy with the grid and use the grid power when your power output is down; you will be billed only for the extra power consumed. This way, you save yourself from grid electricity bills but can avail power at any time.
At present in India, the states of Gujarat, Maharashtra, Andhra Pradesh, Tamil Nadu, along Delhi, have some very favorable net metering policies!
Fluctuating grid utility costs are infamous for taking an upward trend. Making a switch to solar is one of the best ways you can guard yourself against rising costs.
On shifting to a solar system, the rate per unit comes to somewhere between Rs. 3.33/unit to Rs. 5.00/unit.
This value remains constant throughout the whole life of the solar panels. This is what makes solar installation an invaluable one-time investment; once installed it is an asset to you throughout its lifetime.
On the other hand, rising electricity costs go up at the rate of 5 – 10% per year. When you compare these two over a longer period, these small savings become very sizeable.
Most solar panels have lifetimes of over 30 years with the majority of companies offering warranties of up to 25 years of the life. Besides, if you opt for a solar loan for the initial expenditure, once the repayment is complete, the power for your property is practically free. The maintenance costs may be an exception; however, they are minimal compared to the predicted rise in grid tariff over the next few years. So, this means that you can live easily, without caring too much about the maintenance of your system!
Despite quicker return on investment, longer use-able life of the installation, and warranty, there is one step that still creates hesitation in the minds of prospective users. The initial investment cost.
However, to help potential users smoothly clear this financial hurdle from realizing their dreams to convert to solar, there are plenty of subsidies and favorable policies on solar panels, from both the central and state governments, are presently available. Subsidies include a 30% discount on the benchmark cost of solar panels offered by the Ministry of Renewable Energy.
Seeing the rising awareness and demand among our citizens to switch to cleaner energy generation for their property, the RBI (i.e. Reserve Bank of India) has undertaken an initiative to aid this switch.
The financing of plants has been categorized as a ‘Priority Sector’ by Public Sector Banks (PSUs).
This initiative has been undertaken with particular outreach to residential owners as individuals or housing societies, as well as small and medium commercial enterprises. Plus, is your home under construction and solar installation is taking place during the construction process? PSUs may consider the installation expenses as a part of home loans as house construction costs.
As a homeowner with solar, you also avail tax incentives and deductions.
With solar set to become a norm, it is a good idea to stay ahead of the curve and reap the benefits of these subsidies!
It is natural that as a homeowner, it is a big concern for you whether your initial expenses will get suitable returns. The answer is yes! They will get amazing returns, through the 20-25 year lifespan of your system both in terms of energy and money.
If you compare with traditional methods of investment such as shares and FDs, solar panels offer an ROI of around 20% which is much higher. There is zero risk with solar installation since the sun will always shine.
After the initial payback period of 5-10 years, energy generated is all profit. Here’s a comparison between a solar panel and an FD (for the amount of Rs. 1,50,000):
“Thinking of moving out? What about my solar installation over this property?!” As a homeowner, this is a valid concern that arises when installing solar over their property. But we have some great news. Photovoltaic system installations add value to your property!
Solar installation is fast becoming a popular choice, making a lot of conscious and aware home buyers want to invest in property that has solar installation. Solar is an asset that won’t depreciate as years pass by, unlike your car. Some factual data to prove our point:
So even if you move, the solar PV system will be sold with it and you will get paid more for your house than what you paid for the system. Solar is the gift that keeps on giving! This might not be your immediate objective while installing solar, but in the long run, for an asset as valuable as your property, solar is going to be icing on the cake!
The process of purchase, installation, and maintenance of solar is a wholesome one, involving members of different professions coming together to make your installation smooth. This not only simplifies your switch to a PV system but also makes it a community effort boosting the local economy.
Solar creates a multitude of jobs; in business, technicians, engineering, installation, and manufacturing. Your installation will do your bit to foster this community at a neighborhood and a national level.
An increase in the Indian economy directly impacts each citizen. So broadly speaking, more economic activity results in more jobs, more money, and of course, a richer country. A richer India will make the Rupee stronger and you can do more with your money. Other outcomes of job growth would be lesser criminal activity and agitations, research and innovation boost, and drive awareness. Hence it will contribute to making our country a safer place, progressive, and cleaner place to live.
Thus, in the bigger picture, by joining the worldwide solar moment, personally or in an institute, you do your bit for the local and national economy.
Thinking of solar installation for your institute/organization? That’s a great move! Here’s why:
Irrespective of whether you are an educational institute a company or any organization in general, the “clean energy factor” for your workspace will make you stand out in the crowd!
Air conditioners, computers, and labs are increasing electricity demand. Adopting solar now can give instant savings which can be used for upgrading infrastructure such as new classrooms, upgrading the library, and conducting training programs for students/employees.
Since you no longer rely directly on the utility grid for power, your institute/organization is protected from both power cuts and rising power costs. An upper hand for both your pocket and productivity!
Even by becoming the first one in your neighborhood to install a PV system, you could be setting an example for your entire locality and winning praise! Solar installations give you the real possibility of owning an asset that has you bragging about but also brings you savings.
If you asked when the best time to move to solar would be ideally, we would easily say NOW! Simply put, the present time is best for making this critical switch for three main reasons:
The fourth reason would, of course, be the fact that the present is indeed a great time to do your bit to save the planet! And of course, save some money in the process.
All of these reasons are evidence that it’s probably the best time to cash in on these benefits offered by solar installations! At ARKA 360, we give you our word that the sun is shining brighter for solarthant it has ever before! While it is an ecological step on your part, this renewable and inexhaustible source of energy will never drain resources of the earth, or your bank balance!