PNB-ADBScheme for financing

Grid Connected Rooftop PV Solar

A PRESENTATION FROM

PUNJAB NATIONAL BANK,HO : SOLAR ROOFTOP CELL, CREDIT DIVISION, NEW DELHI

Government of India has taken an ambitious target of 100,000 MW of solar power by2022 out of which 40,000 MW is to be achieved through Rooftop Solar power plants asper clean climate commitments.

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Rooftop Solar Programme by Government of India

• Gross Metering: The total energy generated by the solar rooftop plant is to be injected into the grid without allowing the generated solar energy to be consumed directly by the consumer.

• Net Metering: The energy generated by the solar rooftop plant is first allowed for self-consumption and the excess energy is injected to the grid

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TYPES OF METERING ARRANGEMENTS

• CAPEX Model :It is the most common business model for rooftop solar where aconsumer pays 100% of the PV system cost upfront. The key advantage of thismodel is that it allows industrial and commercial consumers to own the systemand claim tax depreciation benefits. Majority of the solar rooftop growth inthe country has been on this model. Due to the high capital costs, a customermight not have the required liquidity to finance a system upfront or get thebest debt terms

• Renewable Energy Service Company (RESCO) Model: Under the RESCOmodel, a third-party company finances, installs, operates and maintains therooftop solar panels. The advantage of this model is that the consumer caninstall a solar PV System and also have the choice whether or not to consumethe electricity. Based on the consumption choice, the model is further dividedinto two types – Rooftop Leasing and Power Purchase Agreement (PPA)

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TYPES OF BUSINESS MODELS

• In grid connected rooftop PV solar system, DC power generated

from SPV panel is converted to AC power using power conditioning

unit i.e inverter

• These system generate power during the daytime which is utilized

by powering captive loads and feed excess power to the grid.

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GRID CONNECTED ROOFTOP SOLAR SYSTEM

• Utilization of available vacant roof space.

• Low gestation period

• No transmission and distribution losses.

• Loss mitigation by utilization of grid through net metering.

• Energy and ecological security by reduction in carbon emission.

• Minimum technical losses.

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BENEFITS FROM GRID CONNECTED ROOFTOP SOLAR

• Eligibility:Financing shall be available for Grid Connected

Roof Top Solar PV projects at commercial, Industrial and

Institutional buildings having unutilized rooftop space- Both

Public and Private or any other structure (excluding subsidy

linked projects)

Two categories have been defined for financing.

• Category I: 10 KW to 50 KW

• Category II: Projects above 50 KW capacity.

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SALIENT FEATURES OF THE SCHEME

Project cost: The present Benchmark cost for installation of Grid Connected Solar Rooftop projects is between Rs.45,000 to Rs.60,000 per KW. The cost of Grid Connected Solar Rooftop may further vary depending upon cost of modules,inverter and mounting structure for the specific roof or as per latest notifications issued by Ministry of New & Renewable Energy (MNRE).

Target Group: Sole proprietorship firms, partnership firms including LLP, Limited companies, Private Limited companies, Trusts, Associations, SPV, NBFCs and registered societies.

Purpose: To finance Grid Connected Rooftop Solar PV projects under CAPEX and RESCO models

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• Margin: Minimum 30% with a suitable upfront contribution of the required margin.

Type of facility and Loan Amount:

• Term loan: Need based

• Working Capital Against receivables: Need based

• NFB(LC/LG) facility: Need based.

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• CAPEX MODEL:

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RATE OF INTEREST

Internal Risk Rating/PNB Score/ PNB ScoreSME

Proposed Interest Rate Linked to 1 YearMCLR

A1 >80 1 yearMCLR-i.e Presently 8.15%

A2 >70≤80

A3 >64≤70

A4 >58≤64

B1 >52≤58 1 yearMCLR+30bps i.e. Presently 8.45%

B2, B3 and below C ratedaccounts

>35≤25

Not to be considered

Internal Risk Rating/PNB Score/ PNBScore SME

Proposed Interest Rate Linked to 1 YearMCLR

A1 >80 1 yearMCLR-i.e Presently 8.15%

A2 >70≤80

A3 >64≤70

A4 >58≤64

B1 >52≤58 1 yearMCLR+30bps i.e. Presently 8.45%

B2 >46≤52 1 yearMCLR+40bps i.e. Presently 8.55%

B3 >40≤46 1 yearMCLR+50bps i.e. Presently 8.65%

C >35≤25 Applicable card rate.

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RESCO MODEL

REPAYMENT PERIOD: Door to Door tenor of maximum 15 yearswhich comprises construction / installation, moratorium andrepayment period.

MORATORIUM: 1 year after 1st disbursement or 4 months fromCOD, whichever is earlier.

TECHNICAL SPECIFICATION :For technical specifications field functionaries are advised to refer the guidelines issued by MNRE and other government agencies as specified in the following link for latest addition IEC/ equivalent BIS Standards/ MNRE Specification

http://mnre.gov.in/file-manager/UserFiles/TERI-Technical-Manual-Banks-FIs.pdf

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Evaluation of Loan application for Grid Connected rooftop Solar PV Projects: A checklist for evaluation of loan application for rooftop solar PV projects is attached as per the link for ready use of field functionaries.

http://mnre.gov.in/file-manager/UserFiles/TERI-technical-manual-bank.pdf

This checklist should not be taken as exhaustive and branches should refer to latest guidelines from website of MNRE.

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PPA AGREEMENT: Long term off take agreement with Discom / a procurer should be in place. In case

• PPA is executed with Discoms whose risk rating in the grade “B and worse” should be supported by sponsor / promoter for debt servicing.

• PPA is executed with private procurer (off taker) subject to their evaluation based on the scoring model.

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Please feel free to contact :

Anand AgarwalAssistant General Manager,

Punjab National Bank

Head Office : Credit Division

Mob. Number : 8826421777

Email Id anandagarwal@pnb.co.in

anandagarwalpnb@gmail.com

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