Financial Options at Affordable Power Solutions (APS)

Understanding Power Purchase Agreements (PPAs) for Businesses

What is a PPA?

A Power Purchase Agreement (PPA) is a financial arrangement where APS installs, owns, and operates an energy system on your business's property. You purchase the electricity the system generates at a predetermined rate, typically lower than your current utility rate, for a specified period.

Who Qualifies for a PPA?

Our PPAs are designed for businesses in every sector with a monthly electricity bill exceeding R30,000. This threshold ensures that your company can maximise the financial benefits of switching to a more cost-effective energy solution.

Benefits of a PPA with APS

1. No Startup Capital Required: You don't need to invest any upfront capital. APS handles the costs of installation and maintenance.
2. No Hidden Costs: The agreement is transparent, with no unexpected fees or charges.
3. Immediate Savings: Start saving on your electricity bills from day one with guaranteed lower monthly payments.
4. Reliable Energy Supply: Enjoy a consistent and reliable energy supply tailored to your business's needs.

Switching is Simple

Switching to APS as your electricity provider is as straightforward as changing your cell phone network. Our team manages the entire process, ensuring a smooth transition without disrupting your business operations.

Case Study: A Business Spending R35,000 per Month on Electricity

Scenario Overview

A business spending R35,000 monthly on electricity can benefit significantly from switching to a Power Purchase Agreement (PPA) with APS, especially considering the average yearly increases in Eskom's pricing.

Eskom Rate Increase

Eskom's electricity rates in South Africa have been increasing by an average of 12% annually. This continual rise can heavily impact businesses reliant on Eskom for their energy needs[Eskom][Eskom].

Annual Increase with PPAs

In contrast, PPAs in South Africa typically include a fixed or Consumer Price Index (CPI) linked price increase. The CPI in South Africa has averaged around 5% annually, making PPAs a more stable and predictable cost option for businesses [Renewable Energy Hub].

Financial Comparison: Eskom vs. APS PPA

Let's compare the cumulative costs over 25 years:

• Eskom: With an average 12% annual increase in electricity rates, the cost of electricity will rise substantially over time.
• APS PPA: Assuming a 30% savings on monthly electricity costs and a CPI-linked increase of 5% annually.

Cumulative Cost Over 25 Years

The chart below illustrates the cumulative cost comparison over 25 years:

Key Takeaways

• Eskom: Cumulative costs increase dramatically due to the annual rate hikes, leading to significantly higher long-term expenses.
• APS PPA: Fixed, lower monthly payments ensure substantial savings over time, providing financial stability and predictability.

Lifetime of the System

A PPA with APS offers immediate savings and protects your business from the escalating costs associated with Eskom's annual rate increases.

Get Started Today

If your business spends more than R30,000 monthly on electricity, contact APS to explore our PPA solutions. Enjoy lower energy costs and a reliable power supply without the burden of escalating expenses.

Financial Options for Residential Users

Rent-to-Own vs. Subscription Models

At APS, we offer flexible financing options for residential users, including a rent-to-own program with significant advantages over traditional subscription models.

Why Choose Rent-to-Own?

• Ownership in 5 Years: With our rent-to-own program, you make five-year monthly payments, and then the system is yours.
• Cost Savings: Unlike subscription models, which require indefinite payments, rent-to-own ensures that payments stop after five years, leading to long-term savings.

Case Study: A Typical Home

Let's consider a home that spends R3,000 per month on electricity using Eskom rates of R1.50 per kWh (just an example, it can cost more or less depending on your municipality or if paying Eskom directly and what your current rates are). This equates to a monthly usage of 2,000 kWh.

Using an 8kW System

An 8kW solar system can produce around 1,200 kWh monthly, reducing reliance on Eskom.

Financial Comparison: Rent-to-Own vs. Subscription

• Rent-to-Own: Assuming a 50% immediate savings, the monthly cost would be R1,500. Over five years, the total cost would be R90,000.
• Subscription: Assuming a 20% immediate savings, the monthly cost would be R2,500. Over 25 years, the total cost would be R750,000.

Cumulative Cost Over System Lifetime

The chart below illustrates the cumulative cost comparison over the system's 25-year lifetime:

Key Takeaways

• Rent-to-Own: Significant savings after the ownership transfer point (5 years).
• Subscription: Continuous payments lead to higher long-term costs.

Get Started Today

Contact APS to explore our financial options for businesses and residential users. Enjoy the benefits of lower energy costs and a reliable power supply without the burden of upfront capital or hidden expenses. Visit our website or call us today to get started on your journey to more affordable and sustainable energy.