Why Solar Makes Sense for Indian SMEs - Part 2

DECISION TO GO FOR LARGER SYSTEM

Having observed my 13.32kwp office system for three months(Blog Part 1), I decided to go for a larger solar PV system in my Tumkur plant.

I decided to go for a polycrystalline (since roof area was not a limiting criteria) PV panel system with Solaregde optimizers and inverters. Also during the factory construction planning stage in 2017-2018, we had made necessary arrangements with a sufficient space for fixing of solar power meter etc in the HT meter cubicle. Due to this the electrical paneling work was minimal and only LT Panel some work was required.

The sanctioned load for this HT connection is 250 KVA and hence as per government rules we could have gone in for a maximum of 80% (200 kWp) of that for a solar PV system. The usage data in this factory was put in a PowerPoint and data was as below:-

The average units (kWh) per month was around 32-33 MWh. Hence we planned a 165.49 kWp system which will be on net metering basis. This system on average should generate 22.7 MWh and cover ~70% of the energy demand.

Finally considering the number of inverters per kWp of installation, roof area and cost, we finalized with Ecosoch (who did my earlier 13.32 kWp system) for a 165.49 kWp system.

These were the initial renders how panel installation layout was planned:-

The installation was to begin, the panels, inverters etc were delivered to the site and lo and behold the pandemic hits.

The process comes to a standstill. Almost 2-3 months are lost and work began slowly as restrictions began to ease.

First the bases for mounting the panels were fixed on the metal sheet roofing as shown below:-

Then the panels are fixed on them and aligned with proper spacing considering cleaning of panels will need to be done.

Then the wiring, earthing and lightening arrestor etc were done. Then the DC wires from the panel optimizers are drawn down and taken to the inverter location and all wired as shown below:

Then began the long wait for BESCOM to give us the calibrated bi-directional meter from their MT labs, which was not operational due to Covid. Finally a month since installation was completed by end of May the meter came in and fixed. Then the BESCOM engineer had to come in and commission the system which happened on the evening of June 3, 2020.

Return on Investment

We have used our internal accruals to fund this project, but for academic purpose, I have considered a 100% financed installation at 10% PA interest.

I have considered loan tenure of 48 months and zero down payment to make sure that the average monthly savings (plus depreciation benefit) are greater than the EMI , such that the system pays for itself. GST input credit is available to my company so that is 8.9% of project cost.

I have modeled the calculation such that if I were not to go solar I would have continued paying for the electricity, instead I pay off the loan for 48 months. The tables above are self explanatory. After that the system provides free power till it lasts (panels have 25 year warranty and inverters 12 years with an option to extend to 25 years). If all goes as per plan and Tumkur continues to be bright and sunny most of the year by year 25, power savings would be a cool 494 Lakh.

At the time of writing this blog almost a month a few days since system went online, the generation stats are as follow:-

Conclusion:

Beautifully said in the write up in Investopedia -

“Determining whether to install a PV solar system may seem like a daunting task, but it is important to remember that such a system is a long-term investment. In many locations, solar power is a good choice from a financial perspective. Even if the cost of solar power is found to be marginally more expensive than electricity purchased from a utility, homeowners/ industries may wish to install solar power to avoid future potential fluctuations in energy costs, or may simply wish to look beyond their personal financial motivations and use solar for "green" living.”

Arun Bhat S

Director, Krishi Group

C0-Founder, Tesla Club India

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