Internal opinion regarding Ukrainian PV market

Solar energy market in Ukraine is experiencing a rapid growth stage. Like mushrooms after rain open solar power plant in the Crimea and Odessa region. But until recently, all the processes taking place under the sign of one company. More surprising was the news from the company Rentechno, who said about the commissioning of several solar parks in the Vinnitsa region. We decided to get acquainted with the company co-founder Dr Dmytro Lukomskyi.

Good day, talk about the company and its history

— Rentechno — Ukrainian company, which started in 2009. We started as a project SolarUA, which still exists today. Initially the idea was to open in Ukraine production of solar panels. But in reality the height of the financial crisis and a significant increase in pressure on the market Chinese manufacturers had to freeze this initiative. We made a strategic decision to expand its activities towards the implementation of renewable energy technologies and energy efficiency and conservation. In 2010 opened a retail area for private investors and medium-sized businesses. Unfortunately, the desired development of this trend has not yet received, because the decisive factor for the Ukrainian buyer is the high price of the equipment. Around this same time, at the legislative level in Ukraine has been fixed «green tariff», and we thought it appropriate to begin to work with objects of industrial scale. To date, over 90% of our business — the construction of solar power plants.

When we started, we were looked at as visionaries, because almost no one believed in the future of the solar energy market in Ukraine, especially in times of crisis. But time will put everything in its place.

I can say that the key success factor is the experience of our employees — more than 10 years in solar energy. We managed to gather a great team, which includes people who took part in the launch of production of silicon solar cells and solar panels, as well as professionals who mounted solar power plants in Kazakhstan, Iraq and Macedonia or worked in Europe for maintenance of solar power plants.

In what role you are acting?

— Our business model is EPC, i. e. usually we will guide the construction of solar power plants from pre-design work and to supply equipment and commissioning. Company has all the necessary material resources and infrastructure for a successful business, including engineering resources. We have established contacts with proven subcontractors who perform civil and other mainstream work. Behind them we always leave the overall control of the project and the processing works that require specialized knowledge and skills. Currently in our portfolio of approximately 20 MW PV power projects at various stages of implementation.

The law spelled norm «local content» for projects in renewable energy — in 2013 it is 30% and 50% from 2014. How are you going to conform to these standards?

— According to our calculations, we have already reached a level of 30-35% local content. It’s all design and construction work, as well as equipment such as AC cables, fencing, cameras, metal, transformers, foundations, etc. For example, the supporting metal alone occupy about 7-10% of the value of the object. Therefore, the transition to the new rules, we are quite ready.

Tell me if there are barriers — legal or bureaucratic — to enter the market of solar energy?

— The path for obtaining all permits required to start work uniquely complex and challenging. We have already got some experience, and I can say that the main challenge — this time. Some projects to obtain all permits and permits takes about 8 months. You also need to consider the value of projects. We focus on projects with capacity of 5-7 MWp. On large projects, the level of bureaucracy, is likely to be far higher, will be added to the same technical difficulties to connect large capacity to the network. But, by and large, I cannot say that we put «sand in the wheels» and have special obstacles.

Tell us about the competitive environment. Everyone has heard about the big projects of the company ActivSolar. You are competing with them?

— Rentechno Company works in a different niche and other regions. We do not intersect either geographically or by capacity projects. Rather, some of our clients can compete with them, but not Rentechno. Many work in the direction of solar energy, but in fact today among commissioned large objects but you called us, we currently only have our clients’ projects.

You can talk about competition for certain types of work, such as design work. You can book a cheap project, but the loss of solar power imbalance significantly increase the payback period of the solar station. We are always ready to count this economy for our customers.

Let’s look at the realized projects.

— We worked with a group of companies «Energoinvest» and «Novosvit», which implemented 4 projects, 3 of which have already been completed and executed supply of equipment, and for the fourth we are now completing the development of design documentation. All of these properties are located in Vinnitsa region and, I must say that the potential of the region is not much less than in the southern regions of Ukraine. Especially when compared to the solar potential of Ukraine and Germany, we have it even higher. And we all know that Germany — one of the world leaders in solar energy. So do not think that the sun is only in the south, can be economically feasible to build and north of Kiev.

Now there is quite a favorable environment for the development of solar energy. Panels are getting cheaper, has a «green» tariff, why in such circumstances is not to try new technology? For example, trackers or micro-inverters.

— We constantly test and test a variety of technologies, attend exhibitions, exchange experience with colleagues to keep abreast of all the latest developments. On the roof of our office, for example, has a small experimental solar installation. But so far for potential customers is much harder to justify the economics of the project using more expensive solutions. We still did not have projects of less than 1 MWp, and the investor is investing at least 2 million Euros. Therefore, the customer is committed to making the project on proven technologies with guaranteed result.

Tracked the same technology has its shortcomings, despite the large production. For projects using trackers requires 1.5 times more area, in addition, they have a lot of moving parts that consume electricity. Trackers need to maintain and difficult to predict how they will affect multiple transition to freezing temperatures. One thing — a theoretical increase in power, and the other — operation in specific climatic conditions of Ukraine.

A similar situation with micro-inverters. Yes, they control the production of each panel, giving poor performance panels understate the entire line. But the question is how increased cost of 1 watt of installed capacity. Rough estimates for the price give 25% of the cost. Doubt that micro-inverters can provide the same performance gains.

On the other hand, all of these technologies will save money over time. But investors do not want to wait, no one can guarantee what will happen in 5-10 years. Technologically, we control the production of all its facilities. Through the Internet we can completely control work stations.

How do you see the prospects for the solar energy market?

Everything depends on the legislative changes. Until 2014, the market is expected to develop rapidly. There will be new players, as developers and investors alike. I think that in 2013 we will hear a lot of news on the realized projects.

Materials: ElektroVesti