How do I finance my renewable energy?

Renewable energy is hot! Many people are concerned with sustainability in their own way. This topic is also high on the government's agenda. In order to achieve the energy objectives, the energy transition is strongly stimulated by the SDE, EIA and Postcode Rose scheme.

Many companies cleverly capitalize on the financial possibilities that these schemes offer. Companies have even started up whose business model is fully based on the SDE scheme. The scheme is the main pillar under 90% of all renewable energy initiatives.

In addition to the SDE funds, interest rates are also historically low, which means that money can be obtained relatively cheaply. Wealthy parties are interested in investing in solar panels. These are the most important factors, which make the production of sustainable energy financially interesting. Any company with real estate in the form of roofs or open plots is potentially a project location for the production of sustainable (solar) energy. These types of companies should all think about whether they want to use the location for this.

No space to invest in this yourself? Do not panic. There are many companies that want to take this off your hands. In addition, agricultural locations are relatively interesting for the production of sustainable energy. Agricultural entrepreneurs are increasingly approached by companies that want to sell solar panels or rent available surfaces of roofs or land.

The question of whether solar panels are suitable for a company-specific situation and which choice is the best to make is not very easy to answer. An important question that needs to be answered is whether I want to invest myself and/or make my location available. What will play a role in this is the possible financial return. This again depends on the form of financing.

The possible forms of financing at a glance:
Invest yourself 
This allows you to manage the entire process yourself. It comes at the expense of investment space at the bank and creates more risk for maintenance, etc., but the highest return can be achieved with this. You are your own boss. Does your bank offer green financing? Then you also get an interest discount of up to 0,5%.

operating lease
Here you make surface in the form of a roof or land available to another company. This company installs a complete system and is responsible for maintenance and running of the system for a longer period of time. There is often a pre-agreed fee for this.

This fee is often a derivative of the project yield, which is determined by, among other things, the size, the costs of (increasing) the connection, which part of the electricity can be consumed itself (settlement) and of course the amount of the SDE decision. The investment is for the tenant.

In many cases, 80% of the project is financed by a bank and 20% through external financiers or crowdfunding. With this construction you do not become the owner of the system, so it is not tax depreciable.

Financial lease
Here you lease the system from a supplier or financier. You become the direct owner of the system. It is not at the expense of the investment space at the house bank and is tax depreciable. In most cases, you bear the risk for maintenance. Compared to a mortgage loan, it is a more expensive form of financing. You pay relatively more interest. This is because there is no collateral for the lender.

Postcode rose arrangement
In addition to investing in crowdfunding projects, the Postcoderoosregeling private individuals the opportunity to invest in solar panels. Investments are made through a collective in the form of an energy cooperative in a large-scale solar panel system or windmill project. In proportion to the financial contribution, exemption is given from the energy tax of the private electricity bill of the private individual.

This means that solar panels no longer have to be located on your own home or business premises, but can also be installed elsewhere. For example on a large agricultural roof just outside the village, on the roof of the local village house or even on an available plot of land nearby. Farmers can rent out their roof or possibly plot of land to an energy cooperative. In addition to the SDE scheme, this can be an opportunity to get (more) income from your real estate with the production of sustainable energy.

Renewable energy
Am I going to invest myself or am I going to make it available? As a property owner, think about the possibilities. In addition, consider when a party will be definitively partnered. Develop the preliminary phase yourself where possible, this will strengthen your negotiating position with roof tenants and operating companies.

DLV Advice

DLV Advies is an independent consultancy for entrepreneurs, companies and organizations in the agricultural sector. In addition to individual advice, DLV supervises study groups and is active in various Agri&Food projects.

© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.