Power Cost Savings Cover EMIs for Rooftop Solar: Tata Power Executive
More consumers opting for solar due to lower costs and access to affordable finance
With better awareness among smaller businesses, the misgivings about rooftop solar installations have largely disappeared, leading to more commercial and industrial (C&I) consumers embracing rooftop solar systems to replace power procurement from the grid, Shah Masood Jafar, Regional Head, Rooftops, Tata Power, said at Mercom India’s C&I Clean Energy Meet in Noida.
Shah Masood Jafar was part of the panel discussion on the topic: Clean Power Purchase – Options and Technologies Maximizing ROI.
Below are important excerpts from Jafar’s responses.
What are the most attractive features of rooftop solar systems for commercial and industrial units?
The price benefits are still one of the primary drivers, along with the return on investment (RoI). But other aspects are increasingly coming into the picture.
Over a period, consumers have tasted success, especially in the MSME sector. They have experienced their investments coming back in four to five years.
Previously, consumers would be hesitant and install systems for about a maximum of, say, 15% of their power requirement, but now the journey is towards 100% of the consumption.
What are the common misconceptions among consumers about solar rooftop installations?
In the initial days, people thought solar was not reliable and expensive on top of it. But the myth about it being expensive does not exist anymore.
The reliability has also improved over the years as local entrepreneurs became involved in offering solar solutions in small cities, thus driving market growth. It has shown that the locals make the market for solar. Today, the awareness level is often very high when we go to the market.
Additionally, the availability of affordable finance has also helped bust the misconception that solar systems are expensive for small businesses.
In the last two years, most major banks have started offering affordable loans for solar. The lenders are also promoting solar through their network. So, consumer confidence increases when a bank or an NBFC promotes products through financing.
What are the benefits of solar energy that a consumer must know about?
If the monthly installments on loan taken out for installing a rooftop solar system are close to the reduction in the electricity bill, then the consumer doesn’t mind paying it.
For a typical small business, the monthly interest cost would be around ₹2 lakh (~$2,425), while the saving on commercial tariffs not being procured from the grid anymore would also be in the same vicinity.
And it gets better for the consumers after 5-7 years because the rooftop solar system and electricity generated are free for the next 17-18 years.
Rooftop solar solutions become even more crucial for industries with high process costs. The savings can be plowed back into the business. Moreover, these businesses also have relative certainty about their power cost for the next 25 years.
Are small businesses becoming more climate-conscious?
Small businesses have become increasingly aware of climate issues, and it is one of the biggest changes I have witnessed over the years. We have consumers who have opted for solar only because they consciously want to contribute to the environment.
Mercom India’s C&I Clean Energy Meets bring the commercial and industrial sector face-to-face with green energy developers and financiers specializing in designing, implementing, and funding renewable energy solutions.
Mercom India will host ‘C&I Clean Energy Meet’ series across major cities in the country in 2023.