Investing in solar comes with potential rewards, but also some important risks to consider. Here's a simplified overview of the main risks involved with Solar projects:
Insolvency or restructuring risk
End Customer Default: There is a possibility that the end customer may default on payments. To mitigate this risk, we implement measures such as taking deposits or blank cheques or even obtaining bank guarantees from them. These steps are taken to safeguard against potential payment defaults and provide a level of financial security for the project.
Partners or Contractors: There is a risk that our partners or contractors could encounter financial challenges, impacting their ability to meet their obligations. This situation may result in increased costs or changes in service levels.
Force majeure
Unforeseen events beyond our control, like natural disasters or terrorism, may impact the project.
General contractual risks
Reliance on third-party providers may pose risks. While precautions are taken, we can't guarantee flawless performance, and pursuing a breach of contract may result in delays.
Government Policy
Changes in laws or government policies might affect how you invest in and lease solar panels.
Execution risks
Delays may occur in construction due to regulatory permissions. Efforts are made to obtain permissions on time, but unforeseen circumstances can arise.
Insurance Risk
While efforts are made to mitigate risks through insurance, it may not always be available or sufficient. Insurer defaults on legitimate claims are also a potential risk.
Solar Irradiation
Estimated solar output is based on simulations. There is a level of certainty, but actual results may vary.
Operational Issues
Installation or operational problems may impact solar yield. Agreements and warranties are in place to address issues and ensure system quality.
While risks exist, Vested takes proactive measures to manage them and protect your investment. Carefully review the investment documents and understand the specific risks associated with each project before investing. By being informed and aware of the potential risks, you can make confident investment decisions with Vested Solar.