Site Map   

Return on Investment

The investor/owner of a ground-mounted or roof-mounted solar array ( or any kind of Renewable Energy generation equipment ) is primarily interested in maximizing the return on the cost of equipment and labour which went into the building of that asset.  The key factor is the relationship between cost and return, and there are two ways to make any investment as profitable as possible :

1. reduce the Capital Expenditure ( by building as cheaply as possible )

2. increase the earnings ( by building the equipment to operate as efficiently as possible )

Choosing which method to use depends on how the asset earns money .

A: Payment for " assets in being "

Some jurisdictions pay a grant or subsidy just because the asset exists ( whether or not it produces any significant electricity ).  If you are in such a jurisdiction, then by all means, find the supplier that gives you the lowest ' dollars per watt ' which will reduce the CapEx. Just as a caution, be aware that the 'low first cost' vendors may not be particularly interested in protecting your expensive roof suface .( see sections 4 & 5 of this page. )

B: Payment for electricty produced

Other jurisdictions pay ( via a Power Purchase Agreement or Feed In Tarrif ) for the electricity actually generated and provided to the grid.

In those jurisdictions ( for example, Ontario ) you definitely want to have a system that generates the most electricity and thus the most revenue.  The true metric of a solar array is thus " dollars revenue per year " or " dollars of cost per KiloWattHour produced " That is, the total cost of the system over 20 ( or 40 ) years divided by the total KiloWattHours generated over that same time. .