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FINANCING
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At Sungrove Energy we do understand that it can be daunting task to raise capital for its customers for financing their solar capital investments. So, it offers a range of innovative financing options which enables its clients to transition to solar energy in a very affordable manner.
Cash Purchases: The simplest form to financing a solar project is to buy the system directly. If you have the available capital and tax appetite to absorb tax credits and accelerated depreciation, you may find cash purchases to be the best option.
Benefits of Cash Purchase:
- Faster and streamlined processing and less paperwork. Time taken for completing the project is less compared to leasing and PPA option.
- Greater potential savings since you avoid third party expenses and interest rates.
- Access to all available solar incentives since the system is owned by the Customer.
Disadvantages of Cash Purchase:
- Responsibility of system operation and maintenance lies with the Customer.
- Capital gets blocked.
Solar Capital Lease:
A solar lease is a financing option that allows businesses to generate solar electricity bills with partial upfront costs with all the benefits of owning the equipments. All leased equipments come with a comprehensive annual maintenance contracts offered by Sungrove Energy making it less of a hassle for the Customer to operate and maintain the system.
The combination of known lease payments, tax credits and accelerated depreciation typically results into immediate reduction in electricity costs.
Benefits of Capital Lease:
- Partial cash outflow yet full benefits of owning the entire solar power system.
- Access to all available solar incentives since the system is owned by the Customer.
- Less cumbersome to operate and maintain as it comes with the benefits of comprehensive annual maintenance contract offered by Sungrove Energy.
Disadvantages of Capital Lease:
- More expensive than Cash purchase since it entails third party expenses and interest costs.
- Need to go through a process of credit evaluation from Sungrove energy's equipment leasing partners.
PPA:
A power purchase agreement (PPA) is a financing arrangement that allows businesses or government agencies to purchase solar electricity with zero upfront cost. To achieve this the Customer also often referred as 'host' organization makes available unused rooftop, land, or parking lot space as a location for a solar installation. A third PPA partner of Sungrove energy then pays for the cost of the solar installation and assumes all responsibility for ownership, operation and maintenance once the solar project is complete. The Customer then enters into an agreement with the PPA provider to purchase electricity at a pre-determined rate per kilowatt-hour which would be much lower than the grid electricity prices the Customer would be paying. Once the PPA contract period expires (around 15 to 20 years), the Customer can then either purchase it a reduced price or initiate a new PPA.
Benefits of PPA:
- No initial capital investment since the Customer only pays for the solar electricity that is produced.
- The customer has no responsibility for system operation or maintenance.
- The rate paid for solar electricity is usually much lower than the grid electricity price which the Customer would be currently paying.
Disadvantages of PPA:
- Need to go through a process of detailed contract and credit review from Sungrove energy's PPA partners.
- PPA financing Plan is usually available for large commercial projects.
- The benefits of tax credits and accelerated depreciation are not available to the Customer since the system is owned by the PPA financers.
Solar asset owners and investors that value predictability, we offer services that cover all operations and maintenance costs, including parts and labor. Plus, we back this service with a fixed price, performance guarantee for the life of the plant.
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