PAYG Solar, also know as a power purchase agreement (PPA), is a finance model that allows commercial, industrial and government energy users to install solar power with zero up-front-cost. In return, the customer agrees to buy the solar power that is generated at a fixed price for a set term.
The price paid by the customer is fixed per kWh, at a rate at or below the current tariff. At the end of the term, the system belongs to the customer. To be suitable for power purchase agreements, businesses must:
If this sounds like your business, ask your solar power provider about a PAYG Solar model or contact Demand Manager.
Demand Manager offers this kind of funding to Solar System Installers. The value it provides to solar customers is:
This model is not dependent on government schemes or the Renewable Energy Target, however STCs are typically taken into account in the setting of the Solar Tariff.
This approach means no upfront cost to install. The system is then owned by the business at the end of the agreement.
The solar tariff is structured so it is cheaper than the traditional grid tariff and the business makes savings as soon as it is operating. The company will get an electricity bill from Demand Manager for the term of the agreement, that will be a saving on their previous bills without solar power.
The Safari Firearms shop is one of the biggest firearm retailers in NSW. The shop normally opens between 7am and 6pm. They run the usual lights, IT servers, cash registers, air conditioning in the summer months – but this was costing them over $1,000 a month. By installing a solar system under a PAYG Solar model, it helped dropped the bill by around 20%.
The 15kW commercial solar system was also eligible for a rebate worth around $11,000 thanks to the Australian Government’s Renewable Energy Target. The PAYG Solar model meant the customer had no upfront cost. The business makes a saving from day one and at the end of the agreement, they get to own the system outright. For the term of the agreement, Safari Firearms gets two bills – one from the old supplier and one from Demand Manager. Combined, they are less than what the company used to pay.
Demand Manager helps organisations to realise energy and water savings by bringing finance to clean energy projects.
Suite 606, 65 York Street, Sydney NSW 2000
PO Box Q1251 QVB Post Office NSW 1230
Phone: +61 2 9279 4704
Fax: +61 2 8076 7460