Is Zero Capex Solar PV System a Scam??!
Many people thought that the zero capex model means they can own a Solar PV system without forking out money first. And they can pay the “system cost” via a long repayment tenure after it is installed.
Actually the zero capex model doesn’t work this way.
Instead, the PV system is actually owned by the investors who funded it. And the investors make their return of investment via either SPPA or a fixed leasing fee from you.
Under SPPA - Solar Power Purchase Agreement, investors will fund and install a PV system on your roof and sell the solar energy generated at a rate lower than TNB tariff to you.
The Solar energy tariff can be a fixed rate, or a discount rate of the TNB tariff (fluctuating), but for sure it is cheaper than the TNB tariff. So, the difference will be your savings.
And the SPPA tenure can be 10 years, 15 years or 20 years etc subject to both parties negotiation. After the end of the SPPA, the PV system will be yours, and the O&M cost will be under you.
Hence, the shorter the SPPA tenure, the higher the Solar energy tariff will be. Don’t be surprised the solar energy tariff may be higher than TNB tariff if the SPPA tenure is short say 5 years. Because after 5 years the system will be yours.
On the other hand, the Leasing mode - you pay the investors a fixed monthly fee regardless of the quantity of Solar energy generated by the system. And after the contract ends, the system will be yours.
All in all, either SPPA or Leasing, the overall amount that you pay actually is higher than the “system cost + O&M” though. But in terms of cash flow, you’re actually reducing your electricity cost without additional spending.
Thus, it is actually a good option to go green if you don’t want to incur any capex for that.
However, the investors are usually more keen to do SPPA or leasing for large PV system size projects, say at least 100kWp or above, otherwise there will be no economy of scale for investments..
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