CEFC offers huge backing to commercial solar  

Australia’s commercial solar industry received a shot in the arm with the announcement that the Clean Energy Finance Corporation (CEFC) will provide $20 million in funding to energy consultant ET Solar.

“There is huge scope to expand and deepen the solar PV market in the commercial sector,” said CEFC CEO Oliver Yates.

ET Solar will focus on providing solar solutions to major Australian business sectors, like shopping centres, mining operations and other high energy focal points using a Power Purchase Agreement (PPA) business model.

Under a Power Purchase Agreement (PPA), also known as Third-Party ownership, a solar PV system is installed on a large commercial rooftop and the owner of the building then purchases the power from the owner of the system who operates and maintains the system, re-couping their upfront investment by selling electricity to the business owner.

Although this allows companies to reduce their electricity costs, the time-frame required is considerably longer. In most cases purchasing and installing your own solar system will pay for itself in five to seven years, whereas purchasing power at a cheaper rate will temper the benefits and payback periods can exceeding thirteen to fifteen years.

In addition to buying power from a third party, it’s hoped that more medium to large Australian business will join the likes of Apple, Toyota and Aldi who have invested in their own commercial scale solar systems. Most have financed their installation and are using their power savings to cover their repayments, meaning they will own the system in a short period of time and enjoy considerable savings beyond the lease period.

The CEFC is often held up as a beacon of hope as one of the few government bodies that is truly profitable. Making a significant investment in large-scale solar projects only highlights the security of renewable energy for businesses in Melbourne and around Australia.

Lease financing is responsible for funding more than 75% of new household PV systems in California which has enjoyed a solar boom in recent times. Customers enjoy immediate savings on their electricity bill, regular and predictable repayment costs and a solar system without the upfront investment.