I recently developed a bespoke model for a client, adding another valuable template to the renewable energy sector offerings. This business model and deployment strategy might surprise you, as it operates differently than traditional approaches. Here, the primary revenue stream comes from energy sales measured in kWh, rather than installation fees. I'll provide a detailed explanation of the entire model below. I've recently discovered this type of business could be considered 'Solar-as-a-Service'.
$65.00 USD
After purchase, the template will be immediately available to download. It is also included in the industry-specific financial models bundle, the renewable energy business models bundle, and The Super Smart Bundle.
The business behind the model:
- Install solar panels at no charge to the customer.
- In lieu of an installation fee, revenue is earned as the customer pays for the kWh used over time.
- Extra power that the customer does not use can be sold off to the grid.
It takes a lot of work to actually operate this kind of business, but you now get the gist of it.
Template Features:
- Up to 200 deployment tranches.
- Up to 10 years of operation.
- For each tranche, define:
- Installation Month
- Installation Cost
- Lead time (install to kWh production)
- Start Month of Revenue
- % Financed
- Interest Rate
- Term (years)
- Price / kWh
- Price Cap
- Annual MWh Used by Customer
- Sold to Grid
- Price / kWh (to grid)
- Maintenance, Insurance, Other direct costs per installation (ongoing)
- Seasonality assumptions for expected percentage of total annual power output that is generated in each month of the year.
- Monthly and annual pro forma detail (EBITDA and Cash Flow drill down).
- Annual Executive Summary
- IRR, DCF Analysis, Equity Multiple
- Include exit multiple (per EBITDA)
- 18 Visualizations
- Since debt is one of the key driving factors for initial scale, a DSCR is also included.
- Two sensitivity tables
- 1) IRR based on sensitizing exit year and EBITDA multiple.
- 2) NPV based on sensitizing discount rate and EBITDA multiple.
If you wanted to make this a joint venture with investors, you can easily plug in the final output data that is displayed the DCF Analysis tab into any of these joint venture waterfall templates. This would help you plan out various investor scenarios based on preferred equity, preferred returns, IRR Hurdles, or any sort of agreement.
There are drivers to define how the expected kWh pricing changes over time, how the direct costs change over time, and how the grid pricing changes over time.
Why Start a Solar Panel Company?
Starting a solar panel company is a promising venture due to the growing global emphasis on renewable energy and sustainability. As concerns about climate change and environmental degradation continue to rise, governments, businesses, and consumers are increasingly looking for clean energy solutions. Solar power, as one of the most accessible and scalable renewable energy sources, presents a significant opportunity for new businesses. By entering the solar industry, entrepreneurs can tap into a market that is expected to expand rapidly in the coming years.
One of the key drivers behind the viability of a solar panel company is the decreasing cost of solar technology. Over the past decade, the cost of solar panels and related components has dropped significantly, making solar energy more affordable for consumers and businesses alike. This cost reduction, combined with various government incentives and subsidies, has made solar installations more financially attractive. As a result, there is a growing demand for solar solutions, providing a fertile ground for new companies to establish themselves and grow.
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