Granada, March 31, 2006
Frequently Asked Questions:
1.WHAT IS A PHOTOVOLTAIC INSTALLATION CONNECTED TO THE NETWORK ?
A photovoltaic installation connected to the network is an installation that is taking advantage from solar radiation to generate electricity with the use of photyovoltaics boards. The electricity that is generated from this boards in continuous current, is modified by an inverter that transforms it in alternating current. This electricty transformed in alternating current is injected into the network by the means of a bookkeeper that counts the Kwh. (Kilowatt-hour) delivered to the distribution network.
2. WHAT IS PHOTOVOLTAIC SOLAR PLANT ?
It´s the grouping of photovoltaic solar installations installed in an unic place and connected to the electric network for the sale of all the energy produced to the company, in this case (Sevillana-Endesa), with which we´re doig business. The installation, meaning the energy generated and injected, would be established in the name of a person, a mercantile company or an organization. Each installation gets its own owner. However, all the installations will be set up jointly in the photovoltaic park (Huerta Solar Cañete de las Torres, promoted by the city council).
The installation groupment presents several advantages as a complete service of high quality, investment recovery guarantees, financing facilities, services of common monitoring, space for the installation, cover of risks by means of a common policy, maintenance.
3. WHY IS THE GROUPING BETTER ?
The principal aim of the grouping, in order to discuss jointly diverse managements, is to give to everybody the possibility of investing in the electricity production by means of the use of solar energy, a clean and inexhaustible source.
Grouping the maximum number of facilities in only one location, offer a complete and simultaneously customized service. Not everybody gets sufficient place to invest in photovoltaic installation. And, although you have enough place, you may not have sufficient installations to ensure the maintenance and surveillance of those installations. About the dimensions, it is possible to choose between 5,10,15, 20 KW to a maximum of 100 KW (In the case of La Huerta de Cañete, it will be groupings of 10 KW. For every investor, physical person or mercantile company, we recommend not to exceed 100 KW, as the promotion is about 575 % to 100 KW.
4. HOW MUCH DO I HAVE TO INVEST IN EACH INSTALLATION ?
The cost of an installation of 10 KWp without solar follower would be about 70.000 euros. The price includes the subvention transactions, licence granting’s, installation inscription. The collaborating company, in this case, the installer, will provide an analysis, from which it will be possible to visualise the energy productivity results of a 10 KWp installation, as well as the economic balance.
5. HOW MUCH IS THE YIELD ?
The yield will be up to several factors:
-Incomes from sold energy: The price by KWh. sold to electricity companies are fixed to a 575 %, of the average electricity prices, set for the year 2004 according to “la Disposición Adicional sexta del R.D. 436/2004, en 7,2072 c€/Kw.”, what represents 0,4144 €/Kwh. In 2005, this price surpassed 0,42 €/Kwh. And we’re expecting higher prices for 2006, as the consumption price index for the electric production is increasing according to expectations of the state organisms. At the moment, the price is 0,44 €/Kwh. Incomes are guaranteed for 25 years (Art. 33.1 R.D. 436/2004), from a 460 % of the average electricity price or of reference. In the case of a 10 KWp installation that generates per year*.................KWh (*consult data in the analysis installer) the annual incomes would be of ............... € +IVA (Spanish taxes 16 %) (*consult data in the analysis installer). If the investment is proportional,
-Installation duration: The life expectancy of this kind of installations is very long. Initial studies showed a 35 year expectancy life, however while using new materials, and according to historical analysis of the existing installations, experts determinate that it could overpass 40 years. Solar boards manufacturers guarantee that for 25 years, the production remains up to 80 %. If it isn’t the case, solar boards will be changed automatically.
-Installation maintenance:
In order to optimize the operation of the installation throughout his prolonged life utility, it will be necessary to make a series of repairs or substitution of some of the components, like fuses, the inverter, etc., that will vary based on the installation which we choose. These expenses will be of a minimum quantity.
*To be confirmed by express declaration from the installator company :
The following guarantees will also be established…Are excluded from the guarantee
A 3 year guarantee period for the whole equipment, and especially against design or installation failure. This period will begin from the date of delivery…Are excluded from the guarantee damages caused from atmospheric . The final delivery will happen at the end of this period.
Here are following guarantee periods for the principal components
-Photovoltaic modules: 10 years
-Electronic inverters: 2 years
This guarantee will be applied to failures and breakdowns that imply the manufacturer responsibility and … repair, substitution of the defecting equipments but it is not covering transport, manpower, assembly/disassemblig of those operations.
6. HOW TO FINANCE INVESTMENT
Public administrations, ICO-DAE, count with various means in the aim of facilitating investment access and viability in photovoltaic installations. Those means consist in, a series of loan of an 8 year to an interest rate of the Euribor+1 (Current rate at a 3% according to the actual conditions) in collaboration with numerous financial institutions, with an additional subvention at a current value of 3 interest points, for an amount of 90 % of the whole installation cost .
The IDAE give in addition a subvention of 20% of the installation value. Those subventions are dedicated to reduce the capital given by ICO. It permits that money necessity that you have to bring for investing, be at the minimum, given that, on a hand, we obtain a loan up to 90% of the investment, and on the other hand, a non-recoverable subvention of 20% from the IDAE. All of this, with an increase of the premium of 0,44 euros/kWh.
Recently, it has become very common that the state subventions come to end; however, other funds come from other sector to ensure the financiering of this kind of promotions. That’s why SOSTIMA, is now trying to negotiate a common investment, in which all investors can take part, with numerous Bank Institutions that are ready to offer their services with at a preferential interest rate and for 80% of the photovoltaic installations, in the goal of reducing to the maximum the interest rate applicable, which is in any case equal to the rentability rate.
7. WHAT ARE THE FINANCIAL OBLIGATIONS ?
As dealing with business economy, we have to take in charge all the economic activities in the place where we will carry out the Solar Plant and in the municipality in which is located the installation (Ayuntamiento de Cañete de las Torres). We will do this work for you as the taxes of economic activities (IAE) are free of charge.
We also have to make a three- monthly (mod. 300) and annual (mod. 390) value-added tax declarations. Since you have to invoice monthly to the electric company, a 30 day payment policy is applied. Therefore, an annual declaration of operations with third parties (mod. 347) must to be done every year as we´re selling for more than 3.006 to the distributing company per year. And this in the case of an installation for a business association. In the case of an installation for physical persons, they will have to present a three-monthly income declaration of the period (modelo 130) and an annual sum up (mod. 190) of the total amount. Finally, the incomes provided from subventions and electricity sale ( That we will devide per year in order to recovering the installation costs) will be included as incomes although we have also the possibility to deduct the expenses from the installations ( Recovering, interest rate, maintenance, etc...)
Companies, as fisical persons that make investment will have the right to realize deductions from investment on renewable energies by means of the IRPF (Tax on fisical persons) or with the Company Tax for the companies.
8. WHEN WILL BEGIN THE SOLAR PLANT ?
We have already begun to gathering requests from persons and companies that showed an interest for installations about 10KW and 100KW. And this in the aim of beginning as early as possible, to carry out the help and financing requests of the ICO-IDAE.
It is said that the IDAE will start with its new programme at the end of february. What means that the plant installtion will begin on july/august. So that, with a high performance, the installation would end after a seven months period.
We recommend that you make your booking as early as possible in order to speeding up the proceedings to obtain better conditons for your financing and help projects. However, every investor is free to decide when and for its own account, which organization his going to deal with concernIng financing. In any way, this will implicate consequences on the installation prices.
9. WHAT IS THE APPLICABLE LEGISLATION ?
The Electric Sector Law 54/1997, which establishes a new legal frame for the electric sector operation; and the Law 66/1997, that specifies that the electric energy production obtained from renewable energies, can be considered as production systems of special regime what also implies special rate-settings.
Considering the Real Decree 436/2004, that guarantees a premium on the sale of the energy to 575% of the TMR, we will obtain an income of* .............................. € (*to consult data in the analysis of the installer).
Therefore, to end, two good reasons that GUARANTEE these incomes and these yields:
1ª- the Real Decree of Law 436/2004, that it establishes that during 25 years the premium by KW/h. sold it will be abvout 575% of the TMR.
2ª- and the second guarantee is that “the sun always ends up comming out every day”, and it´s an inexhaustible source of energy. According to experts, it is predicted that in no less than 100 years, 100% of the renewable enrgies powers will be solar ones.
[* SOSTIMA has its own calculations of production of energy and benefits for an installation of 10 KWp., but the definite data depend on the type and kind of “photovoltaic solar panel” installed finally in the Orchard Solar, and these data the company that will be in charge to carry out the Installation, have to provide them. Also, it is this company the one that has to ask for, in its name, to Sevillian-ENDESA the necessary permissions for its beginning, reason why in the request leaf she is the one that will be authorized, always under the promoter -Ayuntamiento de Cañete de las Torres- that Manages the beginning of all the Orchard through SOSTIMA SL (Company dedicated to the Management of the Environmental Sustainability, with the functions of Consultancy and Power Engineering, Renewable Promotions, Environmental Solutions, etc…) ]