Solar RESCO/PPA model for commercial consumers

RESCO will develop the rooftop solar projects for its clients on the agreed terms and
conditions. The developer will enter into a long term legally binding lease, right to use or similar agreement
for the roof on which solar project will be installed. The project developerwill enter into a PPA for the supply of power. In this model, the same RESCO is
likely to take up multiple projects consecutively and simultaneously across different locations. The developer company will be borrower in Bank’s books and liable for repayment of loan. No direct relationship will be developed between the Bank and the End-user. Financing could be on project by project basis or the RESCO may look for Line of
Credit on portfolio/bundle of projects basis.

There are three different versions of a RESCO/PPA model

BOOT Model

The RESCO constructs, owns, operates and transfers the ownership of the rooftop solar project after expiry of contract period or as per agreed terms.

Generally, transfer of ownership is made, once the RESCO has recovered its cost of capital and a suitable rate of return.

After the transfer of ownership, the rooftop owner is responsible for O&M and he may choose to retain the services of the original RESCO or he may make his own arrangements for O&M requirements.

BOOM Model

RESCO constructs, owns, operates and maintains the project. RESCO  typically ensures its ability to recover the cost of his capital investment and
O&M expenditures over time.

Rooftop Rental Model

RESCO will enter into lease agreement with the rooftop owner and set up the system on his roof. The rooftop owner will get an agreed amount of rent from the RESCO.

The power generated can be either transmitted into Grid or may be provided to private procurer on agreed tariff.