Site Last Updated on Sep 2nd 2010
Renewable Energy Investment
Thomas Edison – inventor of the electric light bulb said:
“I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that.”
Sourcing green, renewable and efficient energy is the great political and environmental challenge of the 21st century. Solar energy has come of age since the German government and European Union set aggressive targets to raise the use of renewable sources to 20% of total consumption requirements by the year 2010.
The German solar energy market provides the opportunity to invest in a secure, long term, stable renewable energy investment that will generate a substantial income for many years.
Solar Energy Investment: Key Investment Points
- 20 year guaranteed income backed by the German government
- Minimum Investment - 50,000 Euros*
- Net income year 1 of €21,501
- 90% non-recourse finance available
- Return on Investment (ROI) of 17% p.a. net in years 1-20
- After finance is paid off ROI increase to approx 50-60% p.a.
- Investment paid back within 6 years on net income alone
- Independent viability report of every project carried out by bank appointed assessor
- Panels have an expected 35+ year life span
- Invest before 30th April 2010 to secure high fixed tariff
*Тhe minimum investment is 50,000 Euros; with 90% finance this brings the minimum project size to 500,000 Euros. German Banks are offering 90% non-recourse financing to non-German individuals who set up a German company (Gmbh).
A unique time-limited opportunity to make a solar energy investment in the renewable energy industry. Investors can rely on a business model for solar investment with a firm basis in German and EU law.
Safe and Predictable Returns
The EEG policy makes it German law that all utility companies must buy all electricity produced by Photo Voltaic (PV) ‘solar’ systems at a price fixed for 20 years, providing a secure and predictable return. The PV panels are manufactured in Germany with a lifespan of over 35 years and are fully managed and insured.
Who can invest in this?
Investment in the project is permitted through cash sums as equity plus 90% nonrecourse finance from major German Banks. A wide range of retirement vehicles including Personal Pension Plans and Self-Invested Personal Pension Plans (SIPP’s) can invest as well on different terms.
Significance of 30th April 2010
The proposed solar energy fixed tariff cuts in Germany has been delayed until June 1st, instead of April. New rooftop solar tariffs will be cut by up to 16% after this date. Investing before 30th April 2010 will ‘lock in’ the current tariff for 20 years making your investment much more valuable, as investors after June 1st will be earning 16% less gross income.
Investment Strategy
The strategy is to hold this investment for a period of up to 35 years. You can sell the investment earlier, well within 10 years - it is up to you. It is very flexible, the income is paid direct during each year, the balance of the bank loan is reducing every year and the Government tariff fixed for 20 years* before the June 1st tariff drop. Hence, your investment’s value will multiple with each passing year.
*Once locked in your tariff is guaranteed for 20 years but will reduce by 0.5% pa.
Safe and Predictable Returns
The EEG policy makes it German law that all utility companies must buy all electricity produced by Photo Voltaic (PV) ‘solar’ systems at a price fixed for 20 years, providing a secure and predictable return. The PV panels are manufactured in Germany with a lifespan of over 35 years and are fully managed and insured.
Who can invest in this?
Investment in the project is permitted through cash sums as equity plus 90% nonrecourse finance from major German Banks. A wide range of retirement vehicles including Personal Pension Plans and Self-Invested Personal Pension Plans (SIPP’s) can invest as well on different terms.
Significance of 30th April 2010
The proposed solar energy fixed tariff cuts in Germany has been delayed until June 1st, instead of April. New rooftop solar tariffs will be cut by up to 16% after this date. Investing before 30th April 2010 will ‘lock in’ the current tariff for 20 years making your investment much more valuable, as investors after June 1st will be earning 16% less gross income.
Investment Strategy
The strategy is to hold this investment for a period of up to 35 years. You can sell the investment earlier, well within 10 years - it is up to you. It is very flexible, the income is paid direct during each year, the balance of the bank loan is reducing every year and the Government tariff fixed for 20 years* before the June 1st tariff drop. Hence, your investment’s value will multiple with each passing year.
*Once locked in your tariff is guaranteed for 20 years but will reduce by 0.5% pa.
Payment Structure
*Payments for electricity will normally be made quarterly by the utility company based on 90% of the expected output, with a year and balancing payment.
- €3000 (Euro) to reserve a project paid to client account
- 10% on ordering equipment
- 80% on delivery of equipment to the site
- 10% after connection to the grid and start of electricity production*
*Payments for electricity will normally be made quarterly by the utility company based on 90% of the expected output, with a year and balancing payment.
The German government has defined in law the price (fixed for 20 years) and obligatory purchase by utility companies for the life of the project of all the energy produced from the project. Distribution companies are obliged to buy all the electricity produced at prices established by the government.
Environmental Protection Loan Program
German banks have put in place special funding for these projects at preferential interest rates to support renewable energy installations. Currently leading banks include DKG Deutche Kreditbank AG (part of the BayernLB Banking group). They will lend 90% non-course loans secured on your Gmbh company subject to their own assessor confirming irradiation levels.
Independent Solar Assessments
To confirm the viability of a chosen project, an independent solar survey is conducted for your benefit on your chosen roof. The bank will appoint an independent assessor before approving finance.
Experienced Installation Company
Our partners work with an experienced installation company with excellent links to lending banks. They will plan and install Photo Voltaic projects and ‘plug it’ into the German power grid. Our associates will also provide an on-going maintenance and management service for the PV panels over the 35 years or so lifespan.
Environmental Protection Loan Program
German banks have put in place special funding for these projects at preferential interest rates to support renewable energy installations. Currently leading banks include DKG Deutche Kreditbank AG (part of the BayernLB Banking group). They will lend 90% non-course loans secured on your Gmbh company subject to their own assessor confirming irradiation levels.
Independent Solar Assessments
To confirm the viability of a chosen project, an independent solar survey is conducted for your benefit on your chosen roof. The bank will appoint an independent assessor before approving finance.
Experienced Installation Company
Our partners work with an experienced installation company with excellent links to lending banks. They will plan and install Photo Voltaic projects and ‘plug it’ into the German power grid. Our associates will also provide an on-going maintenance and management service for the PV panels over the 35 years or so lifespan.
Guaranteed Income
Law passed in Germany states all utility companies must buy all electricity produced by PV ‘solar’ systems. Furthermore, the German government is guaranteed to purchase the power at a price fixed by for a period of 20 years. This provides a source for your income which is safe, secure and predictable.
Law passed in Germany states all utility companies must buy all electricity produced by PV ‘solar’ systems. Furthermore, the German government is guaranteed to purchase the power at a price fixed by for a period of 20 years. This provides a source for your income which is safe, secure and predictable.
- Net income year 1 of €21,501
- Return on Investment (ROI) of 17% p.a. net in years 1-20
- After finance is paid off ROI increase to approx 50-60% p.a.
- Investment paid back within 6 years on net income alone
As the German feed-in tariff for new contracts will reduce by up to 16% for those starting after June 1st 2010, installations before then will have a far higher value (as their feed-in tariff is fixed and guaranteed for the next 20 years) than those installed in future years, thus making your German company more valuable.
Furthermore, there is an already limited supply of viable roof space in Germany and an increasing requirement to shift fossil fuel generated power to renewable energy.
It is anticipated that most investors will view this as a long term investment that will generate substantial income, particularly when finance is paid off. As this investment provides returns in excess of 35 years, the investor can involve a next of kin in the lease and finance contracts, and as a shareholder in their German company at the start of, or during the investment term. Legal advice should be sought on this issue.
In the survey company’s assessment they use the average number of recorded sun hours taken over a 19 year period by the official German weather bureau (1981-2000). Therefore the weather is a small risk that is well mitigated because it is real sunlight data that predicts your income. Remember the Bank’s decision to lend is based on solar irradiation levels from their own expert assessing company.
Furthermore, there is an already limited supply of viable roof space in Germany and an increasing requirement to shift fossil fuel generated power to renewable energy.
It is anticipated that most investors will view this as a long term investment that will generate substantial income, particularly when finance is paid off. As this investment provides returns in excess of 35 years, the investor can involve a next of kin in the lease and finance contracts, and as a shareholder in their German company at the start of, or during the investment term. Legal advice should be sought on this issue.
In the survey company’s assessment they use the average number of recorded sun hours taken over a 19 year period by the official German weather bureau (1981-2000). Therefore the weather is a small risk that is well mitigated because it is real sunlight data that predicts your income. Remember the Bank’s decision to lend is based on solar irradiation levels from their own expert assessing company.
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