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Do you want to start a solar energy farm company? If YES, here is a complete
guide to starting a solar farm business with NO money and no experience.
Okay, so we have provided you an in-depth sample solar farm business plan template. We
also took it further by analyzing and drafting a sample solar farm energy marketing plan
backed up by actionable guerrilla marketing ideas for solar farms. In this article, we will
be considering all the requirements for starting a solar farm. So put on your entrepreneurial
hat and let’s proceed.
Why Starting a Solar Farm?
Solar farms are replacing croplands that don’t generate enough income from traditional
farming. Other times, solar farms are being placed on vacant industrial sites or land that
hasn’t grown crops in years. Most people are familiar with solar panels mounted on the
rooftop of our house to solar farms, but the truth is that both the solar panels in our homes
and solar farms serves the same purpose but in varying degrees.
The solar panels in our homes are usually single panels mounted on the roof that gets
energy from the sun (solar) and converts it into Alternating Current (AC) for use in the
house, while solar farms which are also known as Photovoltaic Power are a large area of
land where solar tracking towers are mounted to provide power to a large number of
people.
Building a solar farm is a capital intensive business as estimate shows you need at least 1
million dollars to start a solar farm, but the Returns on Investment (ROI) are worth it in the
long run. Instead of trying to use the electricity from solar panels just to power your
refrigerator and computer and air conditioner etc., the solar panels are used to create
power that you sell back to the electric utility. Someone else uses the power you make.
When we put solar panels on your roof, you get a second meter. You have your first meter,
and you buy all the electricity you use from the utility, just like you did before you had
solar. The second meter measures the power your panels make, and the utility pays you for
the power that goes out through this meter. You are a consumer just like you were before,
but you are also a producer (a sort of mini-utility).
Hopefully, it is clear now that with solar on your roof, you are a consumer of electricity just
as you always were. Moreover, you’re a producer of electricity. The electricity that you
produce pays you. Your power is used by someone else which in turn reduces the need for
the electric utility to buy fossil fuels to power its generators (the more you and other solar
panel owners produce, the less they generate from coal or natural gas).
The panels on the solar farm put power into the utility grid. Businesses and consumers use
the power during the day. Fewer fossil fuels burnt. These is what happens with the power
from panels if they’re on your house. You get paid for power produced on the solar farm.
Again, just like having the panels in your house.
A solar farm is a large land area where multiple ground-mount solar tracking towers are
installed. Usually, it can be on a working farm or other open and mostly unimproved land.
The Solar Farm Developers industry is made up of companies that mainly install and
construct solar power grid systems, which is known as solar farms, on a utility scale. The
work executed within the industry include new work, reconstruction, rehabilitation and
repairs et al.
List of Niche ideas in the Solar Industry That You Can Specialize in
There are several niches that you can decide to delve into. Here are some of it;
1. First Solar
2. Clean Energy Technologies®
3. Innovative Solar Systems
4. Topaz Solar Farm (CA, USA)
5. Solar Star, (CA, USA.)
6. Ivanpah Solar Electric Generating System
7. Agua Caliente, Arizona
8. Setouchi, Japan. GE, Toyo Engineering Corp
9. Nzema Solar Park, Ghana.
10. Redstone Solar Thermal Power Plant
11. Amanecer Solar CAP Plant, Chile
12. Jasper PV Project, South Africa.
ECONOMIC ANALYSIS
If you are keeping tabs of happenings in the Solar Farm Developers industry, you will agree
that the demand for construction of utility-scale solar power projects has skyrocketed many
thanks to substantial government support. So also, technological advancements in solar
panel construction will lead to a greater supply of low-cost panels, making solar panels
more accessible for individual consumers, also lowering demand.
Another trend is that the Solar Farm Developers industry has galloped ahead in recent
years as a result of the rapid technological developments in our world, falling solar panel
costs and favorable government policy. In the coming years, demand for solar panel
installation is projected to continue growing.
Ongoing government assistance and aid in the form of tax credits and rebates, along with
technological advancement and research in solar energy, as well as the rising popularity of
solar power purchase agreements, will assist to help revenue grow sharply going forward.
The demand for new solar farms has been backed primarily by government incentives, such
as the Solar Investment Tax Credit (ITC), which encouraged private investment into solar
technologies by offering tax credits. With these incentives, solar farms, and other solar-
power development projects have been built at accelerating rates over the past five years.
Because solar technology is not yet cost-competitive with other types of energy used in
electricity generation, such as coal and natural gas, government incentives have been the
driving force behind industry growth.
Is a Solar Farm Worth Starting from Scratch or is Buying a Franchise Better?
Starting a solar power business requires in-depth learning about the industry, available
products, installation, and solutions for home and business owners. It also involves
establishing relationships with suppliers and their sales consultants, so a supply of solar
equipment is always available, along with a source of in-depth information for the questions
the business owner can’t answer.
The easiest and most cost-effective way to ensure all of the foregoing is to buy a franchise,
as the entire business model is already created, the kinks are worked out and the business
is essentially ready to go.
Research various solar power franchise opportunities and select a franchise to work with.
This way, the business model, including the business plan, and advertising media and
materials are all ready-made. Establish a relationship with the chosen franchise and get as
much information as possible about the way the business is operated, the startup capital
required and the process of becoming a franchisee.
Possible Threats and Challenges of Starting a Solar Farm
Just like any other business, one of the major threats that we are likely going to face is
economic downturn. It is a fact that economic downturn affects purchasing or spending
power. Another threat that may likely confront us is the arrival of a new solar farm or solar
panel installation, maintenance and repair company in same location where our target
market exist and who may want to adopt same business model like us.
Starting a Solar Farm – Legal Aspect
Due to the size of the business, you need to register it as a company with a legal entity.
After making your business plan and estimates, you should start the process of registering
your business name as a legal company and permissions provided by the law to starting a
solar farm. This way, you will avoid legal issues with the law later. You can employ a legal
counselor or Lawyer to handle the process for you.
The best legal entity for this business is starting a LLC. A limited partnership is an
organization made up of a general partner, who manages a project; and limited partners
who invest money but have limited liability and are not involved in day to- day
management.
Usually, limited partners receive income, capital gains, and tax benefits; the general
partners collect fees and a percentage of capital earnings and revenues. Typically, limited
partnerships are in real estate, oil and gas, equipment leasing, family partnerships but can
also finance movies, research and development and other projects.
Catchy Business Name ideas Suitable for a Solar Farm
Every business needs a suitable name to run their activities; but a solar farm business does
not need a top notch brand name to function, all it need is a name for differentiating it
from other firms both in and outside the industry. You can consider any of these names for
your solar farm business;
1. SunnyLight Inc
2. Energy Growers
3. Solar Harvesters
4. Clean Source
5. Sun Oasis
6. Desert Pluggers
7. Solar Growers
8. Zero Emission
9. Green Light
10. Direct Sun Source.
You can also consider the Solar Energy Industries Association (SEIA) provides
information on solar training opportunities, certifications, and training program
accreditation. It also offers a job board, as well as networking opportunities through
chapters and a LinkedIn group.
Certificate of Incorporation
Business License
Business Plan
Non – disclosure Agreement
Memorandum of Understanding (MoU)
Apostille
Employment Agreement (offer letters)
Operating Agreement
Company By laws
Operating Agreement for LLCs
Insurance Policy
Business incorporating fees in the United States of America will cost – $750.
The budget for Liability insurance, permits and license will cost – $3,500.
Acquiring a vast acre of land large enough to contain the numbers of massive solar
panels will cost – $400,000.
The amount required purchasing the needed solar energy equipment, tool box and
repair equipment – $350,000.
Equipping of office facility (computers, printers, projectors, markers, servers /
internet facility, furniture, telephones, filing cabinets, and electronics) will cost
– $30,000.
Amount required to purchase the needed software applications to run the business
– $3,500.
Launching an official Website will cost – $500.
Amount need to pay bills and staff members for at least 2 to 3 months – $250,000.
Additional Expenditure such as Business cards, Signage, Adverts and Promotions will
cost – $5,000.
Going by the report from the market research and feasibility studies, about $1.5 Million to
successfully set – up a medium scale but standard solar farm in the United States of
America.
Seek grant funding from government and private sources. As an alternative energy
business, you may be eligible for significant grant money from a range of sources.
Raise additional financing through traditional means if necessary. Venture capitalists may
be interested in injecting large sums of money into your venture if you impress them with
your business model — your plan for profitability. Banks may also be willing to extend
traditional business loans to help you get off the ground.
Choosing a Suitable Location for your Solar Farm
Mounting a solar farm is a business that requires a land space to get started. Some
professionals estimate that you need at least 15 acres of land to start a solar farm. If you
have the capital, you can out rightly purchase the land, it you do not, you can lease the
land. However, make sure your leasing agreement covers at least 50 years. So that there
will be no need to dismantle the panels sooner than expected.
At this phase, it is time to start erecting the Photovoltaic power. Some companies offer the
service of mounting the solar farm for you. You can give them the contract of mounting the
tower within your land space; the company should also be responsible for major
maintenance and renovation of the solar farm because it is better to work with one
company for a single long-term project than having different companies handle the
contract.
Starting a Solar Farm – Technical and Manpower Details
A BSc degree in mechanical engineering or electrical engineering is required for solar
engineering positions. In some areas, more advanced certification and qualifications could
be required. Degrees in industrial engineering, chemical engineering, and computer
software engineering may also be helpful.
Many of the responsibilities on a solar farm require a Professional Engineer (PE) or Engineer
in Training (EIT) licensure. Licensure requirement: A degree from an ABET-accredited
engineering program, A passing score on the Fundamentals of Engineering (FE) exam,
relevant work experience, typically at least 4 years and a passing score on the Professional
Engineering (PE) exam.
College graduates may take the Fundamentals of Engineering (FE) exam immediately.
Engineers who pass this exam are called engineers in training (EITs) or engineer interns
(EIs). After gaining four years of work experience, EITs and EIs can go on to take the
Principles and Practice of Engineering exam to qualify for licensure.
Several states require engineers to participate in professional development activities in
order to keep their licenses. Most states recognize licensure from other states, as long as
that state’s requirements meet or exceed their own licensure requirements.
More complex jobs may require a MSc or PhD degree. Engineers are expected to participate
in professional development to keep up with technological developments. They should also
be familiar with AutoCAD, a computer-aided design program widely used in engineering.
Within solar engineering, AutoCAD is used for photovoltaic system layout. Some firms may
also use Google SketchUp.
Because solar engineers must consult with clients, create technical reports, and write
emails, they should also have good communication skills which will be of benefit to your
solar farm.
Equipment Needed to Start a Solar Farm
Typically, solar farms use a technology that is known as photovoltaic (PV). These systems
use panels that are specially designed to convert sunlight or solar energy into electricity. PV
systems include a battery, inverter, and solar tracker.
The shining blue panels (which are used to capture the sunlight), is often referred to as
modules, and when used alone provide petite amounts of energy. However, in conjunction
with other panels, much more usable energy can be provided. Multiple modules linked
together are often called an “array.” Several rows of arrays must be establishedto power
businesses and homes.
Arrays often need an inverter to convert the direct current (DC) into alternating current
(AC). Since the inverter is extremely important to a solar farm, it should be purchased from
a reputable company.
Producing this equipment has become relatively cheaper as the demand for solar power
increases. The reduction in cost, in turn, means a lower overhead and a faster return on
investment. Tax credits are also available, which allows for the purchasing of a solar farm
to be more of a realistic opportunity than a dream.
To survive in this industry, consider the use of the following marketing and sales strategies
to attract clients;
Introduce your solar energy company cum solar panel installation, maintenance and
Repair Company by sending introductory letters alongside our brochure to
individuals, households, corporate organizations, religious organizations and key
stakeholders.
Promptness in bidding for solar panel supply, installation, repair, and maintenance
contract from the government and other cooperate organizations
Advertise our business in relevant business magazines, newspapers, TV stations, and
radio station.
List your business on yellow pages ads (local directories)
Attend relevant international and local expos, seminars, and business fairs et al
Create different packages for different category of clients to work with their budgets
and still deliver excellent services
Leverage on the internet to promote our business
Engage direct marketing approach
Encourage word of mouth marketing from loyal and satisfied clients
Place adverts on both print (newspapers and magazines) and electronic media
platforms.
Sponsor relevant community and renewable energy based events / programs.
Leverage on the internet and social media platforms like; Instagram, Facebook,
Twitter, YouTube, Google + et to promote our service.
Install solar powered digital Bill Boards on strategic locations around your target
market.
Engage in road show from time to time in targeted neighborhoods.
Distribute our fliers and handbills in target areas.
Contact corporate organizations by calling them up and informing them of the
services offered by your solar farm.
List your solar farm business in local directories / yellow pages.
Advertise your solar farming company on our official website and employ strategies
that help pull traffic to the site
Ensure that all our staff members wear our branded shirts and all our vehicles are
well branded with our company logo et al.