Utility-Based RESCO Business Model: A Path to Accelerating Solar Rooftop Adoption in India
The Renewable Energy Service Company (RESCO) business model has emerged as a popular choice for solar rooftop adoption in the commercial and industrial (C&I) sector. This model allows businesses to install rooftop solar systems without any upfront capital costs, and instead pay for the solar electricity generated by the system at a discounted rate. This model is attractive to businesses, as it allows them to save on electricity costs while reducing their carbon footprint.
The utility-based RESCO business model is an extension of the RESCO model, where the utility takes on the role of the off-taker, purchasing the electricity generated by the solar rooftop system and then selling it to the customer at a discounted rate. This model has been successful in promoting solar rooftop adoption in several countries, including the United States, Japan, and the United Kingdom.
In Japan, the utility-based RESCO model has been successful due to the collaboration between utilities and local governments. Under this model, local governments provide subsidies to businesses for installing solar rooftop systems, while utilities purchase the electricity generated by the systems and sell it back to the businesses at a discounted rate. This model has been successful in promoting solar rooftop adoption in Japan, and has helped the country to achieve its renewable energy targets.
In the United Kingdom, the utility-based RESCO model has been successful due to the Feed-in Tariff (FiT) program. The FiT program provides businesses with a guaranteed payment for the electricity generated by their solar rooftop systems, which has helped to reduce the risk associated with solar rooftop investments. This program has been instrumental in promoting solar rooftop adoption in the United Kingdom, and has helped the country to achieve its renewable energy targets.
In India, the utility-based RESCO model has not yet gained widespread adoption. However, there is potential for this model to succeed in India, given the country’s high solar potential and the government’s commitment to promoting renewable energy. To make the utility-based RESCO model successful in India, the government can learn from the international experiences of countries like the United States, Japan, and the United Kingdom.
The government can provide incentives and subsidies to utilities and local governments to encourage them to promote the utility-based RESCO model. The government can also introduce policies like the PACE program to help overcome the lack of upfront capital. In addition, the government can introduce a FiT program to provide businesses with a guaranteed payment for the electricity generated by their solar rooftop systems, which would help to reduce the risk associated with solar rooftop investments.
The utility-based RESCO model has been successful in promoting solar rooftop adoption in several countries. By learning from international experiences and introducing policies and incentives to promote this model, India can accelerate solar rooftop adoption and move towards a cleaner, more sustainable future.
International Experiences of Utility-Based RESCO Business Model
| Country | Project | Capacity | Investor | Year |
|---|---|---|---|---|
| USA | The Town of Canton Solar Project | 8 MW | Third Sun Solar | 2017 |
| South Africa | University of the Free State Solar PV Project | 1.8 MW | BioTherm Energy | 2016 |
| Australia | Sydney Markets | 1.2 MW | Autonomous Energy | 2018 |
| India | Amritsar International Airport | 1.2 MW | Amplus Solar | 2016 |
| Kenya | Williamson Tea | 1 MW | Solarcentury | 2015 |
References:
- “Third Sun Solar Completes 8 MW Solar Project for the Town of Canton, Ohio.” Solar Power World, 3 Aug. 2017, https://www.solarpowerworldonline.com/2017/08/third-sun-solar-completes-8-mw-solar-project-town-canton-ohio/.
- “BioTherm Energy Completes 1.8 MW Solar PV Project for University of the Free State.” Energy Global, 14 Dec. 2016, https://www.energyglobal.com/solar/14122016/biotherm-energy-completes-18-mw-solar-pv-project-for-university-of-the-free-state/.
- “Sydney Markets: One of the largest rooftop solar installations in Australia.” Autonomous Energy, 10 May 2018, https://www.autonomousenergy.com/case-studies/sydney-markets.
- “Amritsar airport to go green, solar panels to be installed on roof tops.” The Indian Express, 6 Apr. 2016, https://indianexpress.com/article/cities/chandigarh/amritsar-airport-to-go-green-solar-panels-to-be-installed-on-roof-tops-2759297/.
- “Williamson Tea: Kenya’s first large-scale solar project.” Solarcentury, 16 Oct. 2015, https://www.solarcentury.com/williamson-tea-kenyas-first-large-scale-solar-project/.
Country Program Name Program Type
United States Property Assessed Clean Energy (PACE) Program Tax Assessment Financing Program
Japan Local Government Subsidies and Utility-Based RESCO Model Collaboration between Local Governments and Utilities
United Kingdom Feed-in Tariff (FiT) Program Guaranteed Payment for Solar Rooftop Electricity Generated
References: