WHY ONE SHOULD SWITCH OVER TO SOLAR ENERGY?

Did you know that the majority of electricity produced in India is derived from burning of coal, oil, natural gas, etc., which along with the smoke emitted by our vehicles and the industry is polluting the environment severely? The Delhi –NCR is rated as the third most polluted region in the world. A recent study has shown that every person residing in Delhi, who is above the age of 35, has developed the lungs of a smoker, even if the person doesn’t smoke at all. The pollution levels of Delhi-NCR along with other Indian cities are staggering and many times higher than the prescribed WHO and CPCB limits. If you are born and brought up in Delhi, then you are bound to experience breathing troubles, asthma, etc. Continuing at the current pace, the environment would have been polluted so much that the next generation might not be able to even breathe properly in open air without the aid of oxygen masks.

For whom you are earning all the money for? Hopefully for your children and future generations, but have you ever thought of the environment you’re passing on to them? Is it Clean or Polluted?

We need to find a solution to this problem collectively. Your small support and prudence can go a long way and help change the present scenario. The below mentioned points are crucial steps towards attaining our goal before it gets too late.

If you have compassion to save Mother Earth and love your family, you won’t waste time and start adhering to the following:

1.) Adopt Solar Energy: Solar Energy is available in abundance in India. If you have an open rooftop, then you can supplement your “conventional energy” needs with “Solar Energy”, which is harnessed by modern technology and is able to provide electricity for running even large loads like air conditioners and factory machinery. You can transform your home and office/factory into a Green Building. A case study is given below as Annexure-1 to explain in detail the total financial benefit to an entrepreneur after shifting to Solar Energy.

2.) Move towards L.E.D. Lights: Replace your home and office/factory’s conventional bulbs/ CFLs with LED lights. LED lights have a brighter light output and also consume less energy while providing a longer operating life. It saves around 70% of energy as compare to conventional lighting.

3.) Start using 5 Star B.E.E. rated appliances.

4.) Prefer public transportation (like Metro) to your own vehicle.

5.) Use bicycle for commuting in your neighbourhood and in the local limits.

These remedies can be implemented from this moment itself. These might seem expensive to you, but turning a blind eye towards these might prove even costlier.

The decision is yours!

Do you want to sacrifice your future generations’ tomorrow for your petty benefits today?

Annexure-1: A Case Study for 100 KW Roof Top Solar Panel Project, illustrating the benefits of financial incentives as offered by Govt. of India and impact of the same on the Investment, earnings and Cash Flow of an entrepreneur:

Note:

1. Effects of Inflation, Net metering & increased Power Tariff over the years have not been considered, which would increase the above- mentioned benefits.

2. Figures in brackets reflects cash outflow and other than that it is cash inflow.

Now, after analysing the facts & figures as given in Table-1 & 2, it is very much apparent that a businessman has to pay not more than Rs. 8.22 Lakhs (i.e. Rs. 16.25 Lakhs minus Depreciation of Rs. 8.03 Lakhs) from his pocket in the first year for setting up of solar plant of 100 KW and he will be getting benefits from the very first year of installing his own solar power generating plant at roof top of his establishment. Moreover, the pay-back period is 9-10 years and after that the entity would get the power virtually free of cost. This will be a great saving in operating cost which will give an edge to the products of the entity, as the cost of production will be less than its competitors, who are not using solar power to produce their goods.

An Entity has to invest only Rs. 8.22 Lakh for setting up of 100 KW Roof Top Solar Project

Further, if you compare the loan repayment with the saving in electricity, it is very much apparent that the saving in electricity is sufficient enough to cover the EMI towards loan repayment, meaning thereby an entity need not to pay anything extra on account of loan repayment, which has been taken for setting up of roof top solar plant. Instead you are just replacing the payee from Discoms (Power Distribution Companies) to Banks/FIs. So the cash flow on account of working capital is not going to be affected adversely for the businessman in a long run. This is a win-win situation for any entity and they should consider this decision by analysing the following facts:

No additional financial burden as you are replacing payment to the Discoms with EMI to Banks

WHO MUST URGENTLY INSTALL ROOF TOP SOLAR?

An entity which has:

1) Abundant and unutilized roof –top

2)  Paying heavy Power Bills with high Tariff rates (say more than Rs. 1 Lakh per month and having an effective power rate of more than Rs.6/Unit)

3)  Not getting sufficient and uninterrupted power (say not more than 46 hours per day during day time)

4)  Using Diesel Gen-Set, which on an average cost around Rs.16/unit and going to increase in the coming days due to change in Government policy.

5)  Paying heavy Income Tax

SOLUTION IS SETTING UP OF ROOF TOP SOLAR POWER, BECAUSE OF FOLLOWING REASONS – 

  • It protects your business from the escalating energy bills and costly peak demand rates because in the last 2 years there has been 20% to 37% increase in tariff by State Electricity Regulatory Commission (SERCs) across India and this trend will surely continue unless we harness other alternatives. This increase in tariff is because of the fact that the price of coal is bound to increase.
  • It reduces your dependence on Diesel Gen-set and results into dramatic reduction in operational cost, as gen-set running cost is around Rs. 16 per unit as compared to that of solar power.
  • It is easy to install with well proven technology, affordable and has huge long term benefits.
  • Solar plant on your industrial unit’s roof top is a profitable investment with a payback period of 9-10 years with a return on investment of over 15% and assured returns for more than 15-16 years.
  • Life of Solar Panel is confirmed for 25 years (with Warranty) which ensures virtually free power after payback period of 9-10 years.
  • Your entity would be eligible to claim benefit of Accelerated Depreciation @ 40% under Income Tax Act, during the very first year of installation of solar power or else it can be carried forward, which also results into minimization of Tax Liability.
  • Since the Roof Top Solar Power Plant is Grid Connected, it acts as a back-up in case solar rays are depleted due to cloud cover, haze, fog, rains, etc. On the other hand, if the solar power generated is not utilized then it will feed back to grid and will result into reduced conventional power bills due to the concept of “Net Metering”.
  • Unlimited free supply of the key ingredient, i.e. Sunlight.
  • Reduced dependency on the Grid as you have your own power house on your industrial/residential roof top.
  • Solar System has no moving parts, therefore require minimal operation and maintenance (O&M).
  • Solar Power projects fall under the defined activities of CSR, which are compulsorily required to be incurred by certain entities as per the new Companies Act, 2013.
  • The eco-friendly stamp for your Business/Profession.
  • As compared to conventional power projects, Roof Top solar power projects don’t require huge funds since their size is usually small at between 1 KW to 500 KW.
  • Limited risk and assured returns over a long period make solar power projects attractive.
  • Solar Power has a very little downside due to shorter execution period.
  • India’s national coal reserve is depleting and 80% of the total requirement is being imported.
  • The technology has increased the Project Sustainability & Viability and now cost is at grid parity due to scalability.