Question

Difference between capex and resco model in solar

Answer 1

A Renewable Energy Service Company (RESCO) and CAPEX are types of solar rooftops.

A RESCO would set up the solar power project and then monetise the energy produced as compared to a system integrator, who would install the project and be involved in the execution and implementation of the project for another RESCO.

RESCO Model is different from CAPEX model where the entire system is owned by the developer. Rooftop owners consume the electricity generated, for which they must pay a pre-decided tariff monthly. Thus, for consumers, it is a low-cost intensive option as compared to CAPEX model where the entire system is owned by the rooftop owners.

RESCO Solar model has experts in the field, the system runs efficiently for longer duration and results in the incremental generation as compared to CAPEX model.

In order to meet the goal of Rooftop capacity, in some special category states upto 70% subsidy is given to RESCO solar developers. Since the cost of solar panels fluctuates drastically due to uneven demand, customers are reluctant to opt for CAPEX model.