Investment in Solar Power Plant in Ukraine: Cost Estimation, Business Plan.

Investment in industrial SPP

Why is RES and energy efficiency a global trend?

Experts and leading world agencies predict by 2030 the predominant use of solar and wind energy for the main energy facilities. Why? Because the price of energy produced from alternative sources becomes more profitable for consumers than from nuclear, gas or coal power plants. And this, in turn, increases the demand for facilities that produce energy from renewable energy sources.

 

Виталий Шакало
Vitaliy Shakalo

Operating SPP for sale

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The growth potential of the alternative energy market is forecasted in the world for the next 15-20 years. In Ukraine, due to a number of clarifications in the legislation in 2020, the development of the renewable energy market began to pause, but the more actively the upcoming growth and investor interest are expected. Of course, the earlier you enter the industry, the more interesting and profitable projects you will get!

девелопмент земельных участков
действующие сэс на продажу

  • automated business (electricity is sold automatically);
  • guaranteed regular income;
  • a controlled and predictable process of making a profit - the only energy supplier is the sun;
  • minimal administrative costs: SPS does not require some large number of personnel;
  • alternative to bank deposit;
  • lack of inflationary risks: invest in construction in hryvnias – sell electricity in relation to the dollar
  • state guarantee.
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  • We select the location of the solar power station;
  • We assist in obtaining permits;
  • We design land allocation and conduct an examination;
  • We carry out a standard monetary assessment;
  • We draw up property rights to SPS;
  • We get TC (technical conditions);
  • We Legalize property rights, help with the registration of a legal entity.
  • We calculate: the estimated capacity of the station, the annual generation of electricity (MW * h / year); average annual revenue (euro with VAT), the cost of maintenance and operation, payback period;
  • We are negotiating with banks regarding the financing of the project.

The choice of territory for the construction of SPS

инсоляция в Украине, инвестиции в солнечную энергетику

The location of Ukraine makes it attractive for investment. If you look at the map of solar activity (insolation), you can see that about 80% of the country's territory the level does not fall below three units, which looks promising in comparison with other European countries.
In 2017, total investments in SPS in Ukraine amounted to $ 250 million.
According to the collected statistics, there are no global differences from the geography of the construction of the SPS in the volume of generation and in the return on investment. So, if identical SPS in Chernihiv and Odessa oblasts are “figuratively” built, then the “northern” SPS will generate energy on average 10% less than the “southern” SPS.

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How much does it cost to build a solar power station?

Solar power stations unload centralized networks and make it possible to earn money by connecting the “green tariff” (it is possible to sell surplus energy to the state at set prices). Centralized networks do not always withstand ever-increasing loads, because consumption is steadily growing. A rational way out of the situation may be to use alternative options for generating energy. Solar power stations are autonomous, networked and hybrid; to get paid it is best to use networked ones. There are no batteries in this equipment, a special module converts the radiation from the sun into electricity, which then dumps it into the main network.

The benefits of solar power for investment

High power solar power stations will pay off within 5-7 years and will provide guaranteed profit over the next years. The average life of a solar power station is 25-30 years. However, there are SPS in the world that have been operating for about 40 years and will predictably last another 20 years.

All generated electricity is sold. Solar power stations unload centralized networks because consumption is growing steadily.

There are no batteries in this equipment, a special module converts the radiation from the sun into electricity, which then dumps it into the main network. It is bought by the state at the “green tariff”.

The green tariff for legal entities is “tied” to the euro exchange rate, which ensures the investor against exchange rate risks.

The cost of building a surface SPS for business projects

The predicted value of the turnkey industrial solar power station (power - from 1 MW) is $ 1 per 1 kW of power. The investments made in the construction of the station will pay off in 5-7 years, depending on the capacity. For reference: on a “green tariff” a 30 kW network installation will allow you to earn around 10 thousand hryvnias per month.

Want to get an accurate calculation and design a future solar station? Leave a request on the website of the company EDS-Development.

Request for a quotation for the construction of SPS

Solar power plant as a business: prospects and benefits

Active investing in the renewable energy has brought substantial growth in Ukraine. Can an industrial type solar power plant be considered as a business? What investments are needed in solar power plants and how quickly will they pay off? Who will benefit from such a business area? The answers are in the article.

The growth of investment attractiveness

In 2019, Ukraine had climbed 55 places in rating of attractiveness of developing countries (data from Climatescope-2019 report). The rating is based on data on investments in renewable energy. A hit from the 63rd line to the 8th became possible thanks to the active growth of investments. According to Alexei Honcharuk, the Prime Minister, investments in green energy over the past 5 years amounted to $4.8 billion. In November 2019, in the country several projects with a total capacity of 2.5 GW were in the implementation phase: this is the highest figure in the entire history of independence.

Why is this happening

  1. The purchase price of industrial SPP is about $1 for each W of pre-installed power.
  2. Since 2020, the principles of guaranteed purchase of electricity began to operate in Ukraine provided that the supplier wins the state auction. Auction prices will not exceed the current “green tariff”, but the winner will receive a 20 year guarantee of purchase (whereas the “green tariff” will cease to be valid in 10 years).
  3. Under the new legislation investors are given guarantees of the purchase of electricity before the start of facility construction.

Business, as it is known, "votes with money." Modern investors of solar power plants in Ukraine are: industrial groups, foreign companies, large Ukrainian businessmen. For example, DTEK raised more than $200 million by launching Ukraine’s largest 300 MW industrial SPP. Investment growth is the best confirmation that the solar power plant as a business in Ukraine is profitable and belongs to promising areas.

3 reasons to invest in solar energy

Industrial solar power plant – a business idea with a positive prospect. Reasons:

  • efficiency and stability. According to experts, the global solar energy market will grow over the next 30 years. An alternative to SPP can be fusion power plants, but they will only be launched after 2050. The work of the SPP does not harm the environment;
  • government support and beneficial loan programs. The transition to alternative energy reduces the country's resource dependence. Despite the gradual reduction of the "green tariff", the state does not reject the support programs for industrial SPP;
  • stable income thanks to current guarantees for purchase of electricity generated.

Profitability of a solar power plant for business 

Each business plan for the construction of industrial SPP is individual. Therefore, we will carry out a conditional calculation of a 1 MW solar power station, based on averaged indicators. To implement the turnkey project, the investments of $0.8-1.3 per W of installed capacity are needed: $0.8-1.3 million. A 1.5-2 ha land plot is also needed. The launch term of the facility is from 7 to 12 months. After the implementation:

  • average net electricity generation (per year) —1.245 thousand kWh;
  • “green tariff” in 2020 — 0.1126 euros per kWh;
  • average income for the sale of electricity according to the "green tariff" per year — 140.187 thousand euros;
  • maintenance costs — payroll funding for staff (5 employees) and taxes;
  • payback period — from 6 to 8 years;
  • operational life of equipment (panels, inverters) — up to 25 years;
  • panel power reduction — up to 0.8% per year.

Construction of promising industrial SPP

EDS Development company specializes in design and construction of industrial solar power plants in Ukraine. In our country, solar power plants are promising business with an average payback period of 5-7 years and further profit. The company's specialists draft individual SPP projects designed for auxiliary power supply of industrial facilities or for selling the electricity on the wholesale market according to the “green tariff”. Our experience shows that investing in solar energy is 18 times more profitable than a foreign currency bank deposit. We work with customers from all regions of Ukraine.