Credit; Flickr commons, Mike Baker
So what’s the difference here? – not Solar installers, but instead Independent Solar PV Brokers / Consultants … read on for immediate profit potential…
New Interview – Profitable excess land and roof space use for caravan parks – why Solar panels are the perfect proposition.
Did you know?
Just recently, Michael Eavis (of Glastonbury fame), installed a 200kw system to one of his barns. The installation cost was in the region of £600k, it was financed through the Bank.
He claims that it will be paid off within 6 years, and give him a gross profit of around £2m over the 25 year period.
Solar PV is the perfect technology for holiday parks to increase profits from what is usually classed as “dead space” . Most buildings with large roofs – club houses, pool houses, out buildings, toilet/shower blocks – can benefit. Additionally, there is the PR that would be gained out of such an installation, and, not forgetting, the carbon reductions .
As you know, I’m always trying to offer added value to my Holiday and Home Park customers, which means a never ending hunt for smart strategies that will help your business cut costs, raise your “Green” profile and drive new customers to your site; consider it my moral obligation.
When I got a call from Barry Nutley of Viridis Energie Consultants, I instantly saw the potential for you as a Leisure Park operator, so we arranged this interview for your benefit.
There are hidden profits to be gained from Solar PV installations on your roofspace and on a bigger scale using spare land for “Solar farms“, so read on – you may be surprised…
Adam; Hi Barry, thanks for taking the time to do this interview for Leisure Park Energy – how would you describe the financial benefits to Leisure Park Owners in a sentence or two?
Barry; Hi Adam. Thanks. In April 2010, the Government introduced the “Feed in Tariff”, a scheme designed to promote the use of solar PV, by making it a financially attractive proposition.In a nutshell, you get paid in 3 ways – 1). Just for generating electricity, 2). You save by using the electricity you generate (ie you don’t pay your energy supplier), 3). Additionally, you get paid for exporting any excess electricity to the grid.
What makes it even more attractive, is that the payments are index linked, and guaranteed for 25 years.
Solar PV systems have been described by the Sunday Times as the 5th best investment of the year!
Adam; Ok sounds good, but what’s the bottom line? For those readers out there that are still understandibly sceptical, could you give us some rough figures in a straightforward Return On Investment (if there are any costs?) percentage – wise over year one, two and three years and therafter.
Barry; In the right location, you should expect to see a year 1 return of over 10%, and a growth on your initial investment in excess of 400% over the 25 year period.
Adam; Excellent potential then – how big or small can the installations on a caravan site be?
Barry; The size of systems is only dependant upon roof space available (or indeed land available),and budget!
Adam; Looks good Barry, I guess the final reservation would be how much disruption the installations might cause to Holiday and Home park day-to-day business?
Barry; Very little. Expect some scaffolding to enable access to the roof/s. That’s about it!
Adam: Looks like we’re done here ? Is the next step to read the special report for Leisure Parks below and then who should people contact?
Barry: yes read the report and if readers could contact you Adam, we’ll arrange a survey.
Further reading – special report;
Investing in Renewable Energy
Why Solar Photovoltaic for Farms, Holiday, Home and Touring Parks? how it works
The Feed In Tariff
A financial example
Why Viridis
How can Viridis help?
Why Solar PV:
Solar Photo Voltaic panels use the energy from the sun to generate electricity with no waste, and no emissions this can be harnessed to run electrical appliances in the home and importantly feed back power back to the grid. Solar panels do not need direct sunlight to work, as long as there is daylight, power will be generated, but this will be variable. They do however, ideally, need a south-facing aspect to ensure optimum performance.
Photovoltaic cells use light to generate electricity. There are a number of PV panel technologies, including polycrystalline, monocrystalline and thin-film. This can range from small, kilowatt-sized solar panels for use in domestic households, to larger arrays, which function as separate solar power plants feeding power directly into the electricity grid.
Historically, solar PV was deemed as an expensive luxury. However, in April 2010, the Government introduced the “Feed In Tariff” (FIT) to encourage consumers to invest in solar (and other renewable electricity generating technologies such as wind), with the view to reduce carbon emissions. This scheme replaced most grant schemes that were available prior to April 2010.
This scheme now makes solar PV an attractive financial proposition, with typical year one returns of around 10%, and consequently a number of investors (many European where similar schemes are in operation) are looking at entering the market by either leasing land or roofs, for large scale installations.
What makes the scheme even more attractive is that it is a Government backed scheme, with the payments are index linked, and guaranteed for 25 years. Notwithstanding, the panels are expected to last for around 40 years, so whilst the FIT payments will cease after 25 years, the system will still be generating electricity, thus still reducing energy costs.
Solar PV is the perfect technology for holiday parks to increase profits from what is usually classed as “dead space” . Most buildings with large roofs – club houses, pool houses, out buildings, toilet/shower blocks – can benefit. Additionally, there is the PR that would be gained out of such an installation, and, not forgetting, the carbon reductions .
Just recently, Michael Eavis (of Glastonbury fame), installed a 200kw system to one of his barns. The installation cost was in the region of £600k, it was financed through the Bank. He claims that it will be paid off within 6 years, and give him a gross profit of around £2m over the 25 year period.
The Feed In Tariff:
The Feed In Tariff is made up of 3 elements:
The tariff payments – The consumer will be paid between 29.3p and 41.3p (dependent upon size of system) for each unit of electricity generated, regardless of whether it’s used or not.
The “savings” element – The consumer will save on electricity bills when the system is generating electricity that is also used on site. Please note that the savings will increase in line with fuel inflation, which is likely to be higher than “standard” inflation.
The “Export” fees – The consumer will be paid an additional 3p for each unit of electricity that is generated, but not used on site. IE it is sold back to the grid.
As previously mentioned, this is a Government backed scheme that is guaranteed for 25 years, and is index linked.
A key thing to note, is that in order to be eligible for the tariff payments, the system must be registered and installed under the Microgeneration Certification Scheme (MCS) rules.
Whilst the government plan to review the tariff payments at various stages (the first review is in March 2012), once you are in the scheme, your tariff payments are fixed (with inflation added accordingly).
A Financial example:
The calculations have been carried out using the following, basic, data:
Solar irradiation for Maidstone at 998kwh/m2/a
A 50Kwp system, with a southerly aspect (approx. 400m2)
Angle of panels 30 degrees
Annual electricity generation – approx. 50,500kwh/a
FIT payments @ 31.4p/kwh (the current tariff payment for this size)
All electricity generated is used on site, and the price paid is 9p/unit
Indexed linked calculations at 3% inflation
Panel degradation @ 0.8%pa
Financial returns figures are based on Gross amount
The results are determined by a mathematical model calculation. The actual yields for the PV system can deviate from these values due to fluctuations in the weather, module or inverter efficiency and other factors.
50Kwp roof mounted system
The returns would be calculated as follows:
(50,500 (annual generation) x £0.314 (tariff payment)) + (50,500 x £0.09 (electricity cost)) =
Acc. Returns.
Year 1
Year 25
50,500 Kwh/a @ £0.404/KWh
£20,400.00
£679,000.00
This represents:
A ROI in year 1 of 13.6%.
A “payback” of around 7 years.
A total ROI of 452%.
50Kwp roof mounted mounted system:
50Kwp: Supply & Install – in the region of £150,000 + VAT @ 5%.
Naturally, returns are dependent upon many factors including orientation, angle, equipment type etc.
Why Viridis?:
Since April 2010, there has been a solar “gold rush”, with many companies adding solar PV to their portfolio. In April 2010 there were around 2000 accredited installers, today there are in excess of 5000.
Viridis was set up in 2008, by Partners Barry Nutley and Peter Moore, who both had previous experience in the renewable energy field.
Viridis are independent consultants with no ties to any manufacturers or installers, and our aim is to give our clients the best value for money.
With offices in Kent, Liverpool, and Dorset we can cover the UK comfortably.
Our clients have included:
Kettering Borough Council
A shopping centre in Kent
The Campaign For The Protection Of Rural England (CPRE)
Schools
Community centres
The Lloyd Webber Estates
Many farmers/land owners looking at both barn roofs and land – we are currently working on a number of large scale developments (5Mw – 30 acres – £13m).
Viridis’s services do not stop at solar PV. We cover all renewable energy technologies, including – wind, heat pumps, biomass, solar for hot water, and rainwater harvesting.
How can Viridis help?
Viridis provides a tailored solution for our clients. Being independent, means we can get the best for our clients. Our clients can some some, or all of our services, which include:
Site assessments – We use independent, German developed, software, which has the specific data required to make accurate comparisons on technology.
Brokerage – We search the market, to find the best value products for you. Recently, we saved a client over 13% on a solar PV installation.
Finance – We can arrange commercial finance.
“Free” Solar – For some projects, external investors will pay for the project. They take the FIT payments, the client makes the saving on electricity. Both get the PR. We can search the market for the best deal.
Land lease – There are several investors looking to lease land, with the view to building large scale developments. We can negotiate the best deal for the land owner of a suitable site.
Viridis Energie Consultants LLP
What to do now; contact Adam Beckett of Leisure Park Energy on 0800 0836698 to arrange an initial consultation with Viridis
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