€25,000 per year

Neon_Lights

Ask for a commission on every unit of energy that's made from the panels. They must be making the way more than 25k per year to justify the rent so clawback of a couple of % makes it more attractive

The_Conductor

Neon_Lights wrote: »

Ask for a commission on every unit of energy that's made from the panels. They must be making the way more than 25k per year to justify the rent so clawback of a couple of % makes it more attractive

Thats weird thinking.
They would need a 10% return on their investment cost- before any other factors whatsoever are entered into the equation- so- say it cost a million (which isn't implausible- if anything its optimistic in the extreme)- breakeven on the investment- before any other operating costs- is a minimum of 100k. God only knows what their other operating costs come to- but the 25k they're paying Mirror is among them- call it a round 250k in sunk costs, depreciation and operating costs- and you're looking at hairy figures.

As to what their possible turnover might be- if they reach 10MW capacity- they are obliged, by law, to partake in the SEM which is a Mandatory Wholesale Market for the island of Ireland- where they are paid the marginal cost of producing each unit of electricity (€/MWhr). On the brightside- there is a contribution towards their capital costs recoverable via a Capacity Payments Mechanism, administered by the Network Operator.......

If you look into just how this works- it is hairy- and thats not just for the likes of a solar operator- its for any generator of electricity who hopes or intends to sell it into the network.

Avatar MIA

Also, while a contract is actively being sought with the OP, the company would be monumentally stupid if the OP was the only one they are talking to.

While the OP's land is deemed agreeable, it's unlikely to be unique.


It will be first to agree to mutually acceptable terms that will get the deal.

Neon_Lights

The_Conductor wrote: »

Thats weird thinking.
They would need a 10% return on their investment cost- before any other factors whatsoever are entered into the equation- so- say it cost a million (which isn't implausible- if anything its optimistic in the extreme)- breakeven on the investment- before any other operating costs- is a minimum of 100k. God only knows what their other operating costs come to- but the 25k they're paying Mirror is among them- call it a round 250k in sunk costs, depreciation and operating costs- and you're looking at hairy figures.

As to what their possible turnover might be- if they reach 10MW capacity- they are obliged, by law, to partake in the SEM which is a Mandatory Wholesale Market for the island of Ireland- where they are paid the marginal cost of producing each unit of electricity (€/MWhr). On the brightside- there is a contribution towards their capital costs recoverable via a Capacity Payments Mechanism, administered by the Network Operator.......

If you look into just how this works- it is hairy- and thats not just for the likes of a solar operator- its for any generator of electricity who hopes or intends to sell it into the network.

Ok i may not be as familiar with the electricity industry, however this transaction fee based model works quite effectively in other domains. The only real costs are the costs of capital, infrastructure and maintenance. These may be quite hefty on the outset, however im assuming whoever is setting up this must have crunched the numbers and seen there was a favourable ROI over time to be had. Adjust for inflation and 10% ROI does not seem that great as you have touted, so im making an assumption its more.

It would be favorable for the land owner to tap into that revenue stream if possible in order to maximise the return he is getting from the use of his land.

Also if there was a means of keeping the energy in a potential state only to be sold onto the grid when the price was favourable on the market, this could maximise ROI making such a facility plausable.

davo10

Op, take a look at page 18 of the farming supplement in today's Independent, it has a full page article of advice for land owners who are approached by solar companies.

Stealthfins

I'd suggest you start off on the 25 k a year,also ask for free shares in the company.

That 25k a year should rise to 50k a year over the 25 years.
An incremental scale would be worth looking into.

After all the ball is in your court,if the land is good enough for these guys,you can be sure some other company will be interested too.

They usually offer a rock bottom price first.