Investing in solar energy made easier

4 mins read

With the steep increase in the cost of electricity and with the uncertainty that exists, both for our “own” natural gas and that from Russia (with a hefty price), it is evident the use of renewable energy is a must with the cost difference widening between the EAC charge and solar energy.

Government requirement for the development of photovoltaic parks has changed (the solar panels no longer need to be placed in the spot of ​​consumption, e.g., on the roof of a house).

The solar panels can be placed in Paphos, even if the residence is in Nicosia.

This greatly helps in adding alternative locations freeing consumers to choose based on license where to place their investment of solar panels.

Thousands of people/households either do not have the appropriate place to put the panels or are in dense vegetation with trees (limiting the solar surface).

While other buildings are located with the wrong orientation of their roof, others do not want the vertical cladding of their walls with solar panels for aesthetic purposes, while the placement of panels/units in common areas to serve them (e.g. the roof of an apartment building) creates a problem for shared use.

In some cases, the management also requires, based on the reduction of electricity from the user payment of “rent”.

Therefore, this choice of alternative location offers great prospects.

In the circumstances, the question arises as to whether there can be interested investors, either in one and/or several locations, to build solar parks and make individual panels available to interested “buyers” for their own use.

That is, if a park of, e.g. 1,000 panels and the consumer only needs 10, this means that about 100 consumers will be satisfied under the single management of the original investor (e.g. single investment in an appropriate field) and the disposal of the individual spaces/panels in the form of space rental to place each interested party their own panels or to “buy” the 10 panels (or as many as they need) in full operation (the second option is preferable).

This disposal can be in the form of renting the space of the frames for 15-20 years or the “rental” of spaces and panels, with a charge of at least €15,000/space (10 panels), plus maintenance costs, depending on size, or in the case of a single project, the concession on payment as a lump sum or otherwise to the initial investor.

With this method, the various reservations of the investors are met, and the wastage of vacant space is reduced for such parks.

And areas such as animal farm zones with minimal demand can be put to productive use.

The original investor should commit to the result of this investment.

At the same time, banks can help finance the project (although in our example of parks of 1,000  panels and with the demand that exists, the main cost of the investment will be borne by the buyers/tenants) – in this case producing a total income of €1,500,000.

From our information, the reduction in consumption using solar parks, in contrast to the EAC charges, is around +30% less with photovoltaics, with a payback of the investment of around ±5 years.

It is worth studying the subject in depth.

Antonis Loizou FRICS – Real Estate Appraiser & Development Project Manager