So you wish to invest in a solar energy business but not sure which specific opportunity to invest in.

This is one of the more difficult questions we at Solar Mango are asked. Not because of a lack of attractive business opportunities in the solar energy sector, but because of the wide canvas of opportunities available.

You see, there are solar energy business opportunities available in electrical, construction, manufacturing, O&M, education, support services, IT, finance and more.

In terms of type of business opportunity, solar energy presents business opportunities in manufacturing, services and to a relatively smaller extent, trading.

However, let us first state this: Unlike some risky sectors where you can make significant profits within a very short period of time (for eg., ecommerce or mobile apps), solar energy is not a get-rich-quick sector. Even though some sectors within solar are quite profitable, there are very few sectors that can provide you super-normal profits – an example of such a “select” opportunity could be the instance of developers who were lucky to sign long term power purchase agreements at very high tariffs before the utilities reverted to much lower tariffs. While you certainly should watch out for these select and attractive opportunities, please note these are quite rare.
The solar energy sector thus provides business opportunities with reasonable returns, but such returns are usually available for the medium-long term (5-25 years).

There are many solar business opportunities along the solar value chain, both in manufacturing and in services; however, not all opportunities suit all entrepreneurs. An analysis of the various segments of the solar PV value chain is recommended, with emphasis on competition, financial returns, and risks before deciding on entering a segment.

The diagram below provides an overview of the solar PV value chain:

 

solar biz opportunity

                                                   Figure 1: Solar PV Value Chain

Overview of the business opportunities available in the solar energy sector

The Solar PV value chain represents all the stages, processes, and products involved in the solar PV sector, including manufacturing of materials, system integration, solar products manufacture, etc. As mentioned earlier, based on your business profile, some value chain components will be far more suitable to you than others. The table below gives an overview of the opportunities available to different kinds of businesses:

Your Organisation SOLAR MANGO Suggests Key Drivers Risk Assessment
Large enterprise capable of significant investment Polysilicon ·          Policy support/incentives

·          Reliable low-cost power

·          Scale to achieve production economies

High Risk – Low competition but high investments and long payback periods
Ingots & Wafers ·          Policy support/incentives

·          Reliable low-cost power

·          Scale to achieve production economies

High Risk -Low competition but high investments and long payback periods
Solar Cell ·          Policy support

·          Scale and technology to achieve production economies

Medium-High Risk- Medium competition with high investment and long payback periods
Large enterprise considering medium initial investment Solar Glass ·          Technology

·          Price

Medium Risk: Low-medium competition with medium investments and medium payback period
Solar Module (Thin-Film) ·          Policy support

·          Increased efficiency

·          Scale and technology to achieve production economies

Medium-High Risk – Medium competition, technology risk present, medium-high investments and medium payback periods
Solar Inverter ·          Price

·          Technology suited to  Indian needs &conditions

·          Alliances with EPCs and system integrators

Medium Risk – High competition with medium-high investment and medium payback periods
EPC (utility scale) ·          Cost-effective procurement

·          Administrative expertise in getting approvals etc.

·          Subcontracting network

Low-Medium Risk – High competition with low investment and short payback periods
Developer/IPP ·          Policy support

·          Low-cost funding

·          Optimal power purchase tariff

Low Risk – High competition with higher investment and payback period but good long term revenue prospects for specific projects
SME seeking low investment business opportunities Mounting Structures ·          Design/customization suited to India

·          Alliances with EPCs and system integrators

Medium Risk -Low- Medium competition with low-medium investment and medium payback periods
System Integration for rooftop solar ·          Cost-effective procurement

·          Marketing/promotion

·          Differentiation of product/service

Low-Medium Risk – High competition with low investment and short payback period, but low margins
EPC (smaller projects) ·          Cost-effective procurement

·          Differentiation of product/service

·          Marketing/promotions

Low Risk – High competition  with low investment and short payback periods
SME looking for innovative opportunities Balance of System ·          Product differentiation

·          Alliances with EPCs and system integrators

Medium Risk – High competition with medium investment and medium payback periods
Solar Products ·          Product differentiation

·          Government incentives, for certain product categories

·          Access to retail channels

Medium Risk (depends on the product) – Medium competition with medium investment and medium payback periods
Solar Module (Crystalline) ·          Policy support

·          Increased efficiency

·          Scale and technology to achieve production economies

Medium Risk – High competition with medium investment and medium payback periods
Start up seeking low-risk, minimal investment opportunity EPC Subcontracting ·          Cost-effective procurement

·          Alliances with EPCs

Low Risk – High competition  with low investment and short payback periods

 

Industry Category Opportunities in Solar Energy
Electrical & Electronics

 

  • Solar Power Plant System Analysis &Design
  • Electrical subcontract for MW Solar power plants
  • Design of Off-grid power electronics
Power Generation
  • MW Scale Solar Power Gen– PV
  • MW scale power gen – CSP
  • Rooftop Solar Power Gen – PPA model
Construction
  • Rooftop Solar Packs
  • Residential rooftop solar
  • Commercial rooftop
  • Solar farm and park construction
  • BIPV solutions
Finance

 

  • Financial modelling and analysis support
  • Equipment financing
  • Solar power plant financing
  • Working Capital financing
  • Insurance
Manufacturing – End Products

 

  • Niche off-grid products
  • SPV based transport vehicles (Off-grid Vehicles)
  • SPV educational toys and gifts
  • Solar water heater
  • Solar water pumps
  • Solar lanterns & streetlights
  • Solar cookers
  • Solar LED combo products/solutions
  • Solar  mobile chargers
  • Solar modules – thin films
  • Solar modules – crystalline
  • Inverter manufacturing
  • Cell manufacturing
  • Solar roof tile or solar shingle
  • Solar CST solution
Manufacturing – Raw Materials
 
  • Ingots & Wafers
  • Polysilicon
  • Chemicals for cell manufacturing
  • Aluminium and steel structures for panel frames and mounting structures
Manufacturing – Components & Sub-components

 

  • Solar charge controller
  • Batteries
  • Meters
  • Components for Solar CSP
  • Fuses, connectors
  • Switches & disconnects
  • AC/DC distribution
  • Earthing Kit
  • Lightning arrestors
  • Transformer
  • Junction boxes
  • Mounting systems
  • Wires & cable
  • Solar tracker
  • Clamps & rails
  • Other BoS
  • Transformers
  • Components for solar CSP
  • Copper, Silver and Aluminium supplies – as paste, wires etc.
  • Solar panel backsheet & EVA
  • Adhesives for rooftop solar and BIPV solutions
  • Cutting tools for wafer manufacturing
Manufacturing – Machinery
  • Poly-silicon making furnace and machines
  • Wafer making machinery
  • Diamond cutting tools for wafer making
  • Cell manufacturing machinery
  • Module manufacturing machinery
  • Construction machines for solar farms
  • Furnaces & related equipment for making polysilicon
  • Boilers and Turbines for CSP
Emerging & Innovative Technologies

 

  • Smartphone and smart watch apps for SPV power plants
  • Robotic cleaning systems
  • Niche solar panels – coloured, flexible
  • Unique off-grid products such as bio-toilets
  • Design of innovative power electronics systems such as hybrid inverter for solar/wind integrated power plants
  • Small Scale CSP
Testing, Instrumentation & Control

 

  • Meters
  • Testing & certification
  • Post installation testing equipment for solar farms & rooftops
  • Automation solutions for array placements in solar farms
Onsite Services & Support

 

  • Solar power plant O&M
  • Land sale brokering
  • Local facilitation for solar farms
  • Owner’s Engineer
  • Security systems for solar farms
Education & Training
  • Solar PV technical training & education
  • Solar energy awareness education for corporates and communities
  • Solar educational toys and kits
Media & Marketing

 

  • Online Solar Market Place (E-commerce)
  • Event organization
  • Sales agent
  • Outsourced marketing support for rooftop solar EPCs
IT & Software

 

  • SPV design software
  • Shading analysis
  • Tech solutions for maintenance of SPV farms
  • Solar PP project management software
  • Solar PV software monitoring
  • PV array simulation software
  • Smartphone and smart watch apps for SPV power plants
Commercial and Legal
  • Legal
  • M&A(Mergers and Acquisitions)
  • Consulting & market research
  • Assistance in permitting and approvals
  • Credit rating
Operation and Maintenance

 

 

  • Solar power plant O&M
  • Solar Panel Recycling
  • Outsourced security administration for large scale solar power plants

By the way, if you are really serious about reading a comprehensive guide on the topic of diverse solar energy business opportunities, you might want to purchase, Solar Profits, published by Solar Mango.
The complete list of opportunities classifies based on industry; for the solar energy sector is provided below.

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