A solar panel on the rooftop can provide extra savings by investing in your home, office, or manufacturing unit instead of the market, saving on electricity bills and helping save Mother Earth while you stay at home. There’s simple math behind it. Solar systems have a lifespan of 25 years and require minimal maintenance, primarily panel cleaning.
Let’s understand the economics behind it. For every Rs 1,00,000 invested, customers save Rs 25,000–Rs 35,000 annually, achieving returns in just three years, explained Radhika, Co-founder of Freyr Energy.
In an interview with ResponsibleUs, Radhika explained the complexities of solar panel installation, from consulting to the end product, in such a manner that all of India is eager to adopt it.
What motivated Freyr Energy to focus on democratizing access to clean energy, and how has the solar energy sector evolved over the years?
It’s a great initiative because it’s becoming vital for every human being, especially with global warming and the choices we face. With technological disruption and increasing consumption, economies are doing well. If you look at inflation and GDP rates, everything seems to be moving in one direction, which speaks highly of progress.
But we have just one planet, and there is no Planet B. Fortunately, Freyr Energy has been in this space, not just as a social enterprise but as a
not-for-profit enterprise. The objective has always been to democratise access to clean energy for the majority.
Historically, if you understand the sector, solar adoption was limited to remote locations and rural areas, using small DC fans or lights because of the lack of grid connections. These setups relied on battery systems, but the larger disruption over the last 15-20 years started around 2007-2008 with the National Solar Mission.
The mission primarily targeted large-scale projects, setting up power plants to supply electricity as utilities. Today, the electricity we consume includes a mix of solar, wind, hydro, and biomass, which is how renewables have gained traction.
We spent time exploring ideas to disrupt the sector. Solar adoption was limited due to low awareness. People had numerous questions: what happens during cloudy weather, how to handle excess units going to the discom, maintenance requirements, technology upgrades, subsidy timelines, and workmanship quality. Unlike traditional sectors, where specifications are clear, solar solutions lacked standardisation, leaving consumers uncertain, which is possible with companies like Freyr.
How has the cost of solar energy changed over the years, and what impact has this had on its adoption?
As I above said that the Solar adoption was limited due to low awareness with multiple questions unanswered. Another significant barrier was the perception of solar as expensive. The upfront cost was daunting. However, the cost of solar has dropped dramatically, from Rs 20 crore per MW to Rs 3-4 crore today, and technology has become twice as efficient. For the same space, you can now generate 70-80% more energy. While costs have fallen and awareness has improved, government and media efforts have been instrumental in spreading awareness far more effectively than any single company could.
What role does Freyr Energy see for small commercial and industrial customers in the broader adoption of solar energy in India?
Over the last decade, Freyr Energy has undertaken diverse projects across the country, including village electrification, water pumps, large installations for cement factories, manufacturing units, educational institutions, and hospitals. In the last two to three years, we pivoted from a B2B to a B2C model, targeting homeowners and small commercial and industrial (C&I) customers.
C&I customers, often MSMEs, are the backbone of India but are frequently overlooked in the growth process. They face challenges accessing finance and are often seen as high-risk. However, many of these businesses have excellent track records and strong financials, making them viable candidates for solar adoption. Freyr Energy provides financing solutions to these businesses, ensuring they can adopt solar easily.
How have you expanded your presence across the entire country?
We launched the Freyr Energy App, designed to make solar ownership simple. The app functions like an Uber or Amazon app, providing instant proposals and financing options. It addresses common barriers by asking simple questions about electricity bills and available space, avoiding technical jargon. Customers can choose to offset part of their bills or expand their solar capacity later.
The app also builds trust by offering a user-friendly interface and localised language support. For example, if someone’s parents live in Nagpur, they can use the app in Hindi. The app ensures a seamless experience, making solar adoption straightforward and accessible.
Freyr Energy’s mission is clear: to simplify solar adoption and make it accessible to everyone. By addressing barriers like cost, awareness, and trust, we aim to drive widespread adoption of clean energy.
The app allows users to explore solar solutions and view nearby Freyr customers, fostering trust and confidence in the adoption of solar energy. The app provides maintenance alerts, tracks energy generation, and offers updates on project progress. It simplifies processes like financing, government subsidies, and net meter installations, ensuring a hassle-free experience.
Freyr Energy’s app streamlines the process, providing transparency from procurement to installation. It ensures quality by automating material specifications and includes safety features like waterproofing, wind resistance, and proper grounding. This holistic approach ensures long-term customer satisfaction and system reliability.
Can an individual afford it, and what maintenance is required to ensure optimal performance?
The cost of installing a solar system for an individual house varies based on electricity consumption. For a homeowner with an average monthly electricity bill of Rs 3,000, a 3 kW solar system is recommended. This system costs approximately Rs 2,00,000, with a government subsidy of Rs 78,000, reducing the net investment to Rs 1,22,000. With annual savings of Rs 36,000, the investment is recovered in 3–3.5 years. Freyr Energy provides a five-year warranty and financing options, including instant approvals and 0% EMI.
Solar systems have a lifespan of 25 years and require minimal maintenance, primarily panel cleaning. In India, frequent cleaning is essential due to dust, which affects efficiency. The app prompts users when cleaning is necessary to optimize performance.
Who are your key partners for sourcing and installing solar panels?
As Freyr Energy does not manufacture panels but procures them from top Indian manufacturers like Adani and Vikram. They prioritize quality and consistency by working with a select group of vendors, ensuring superior components and reliable after-sales support. Each solar system comprises 30–35 components, including high-quality panels, inverters, cables, and structures, designed for safety and durability.
What was the point of starting Freyr Energy? When did you decide to move into this space?
When we started in 2008, solar was mostly large-scale, and by 2011–12, it shifted towards rooftops, but still mainly for large corporations. The costs were high, and there were no subsidies or net metering. Net metering was introduced in 2013–14, allowing excess energy to go back to the grid. We noticed that companies were region-bound, limiting their growth. We wanted to scale nationwide, offering a seamless experience, like how apps work across regions, and that’s when we decided to move forward with this model.
How did you approach the challenge of competition and customer affordability in the solar space?
We realised that multiple layers of dealers drove up costs, so we aimed to reduce that by creating a direct model. In 2012–13, we introduced an app to streamline the process. Dealers acted as micro-entrepreneurs, selling solar without operational costs, earning a fixed margin. This model allowed us to reach customers more efficiently. With digital campaigns, we could generate leads even in areas with no physical presence, and post-COVID, the PM Surya Yojana further accelerated solar adoption.
What are solar experience centers, and what is their purpose?
Solar experience centers are retail outlets located in high-traffic areas, designed to build customer trust and awareness about solar energy. They allow customers to interact with the products, such as solar panels and inverters, and also process loans. These centers aim to increase conversions by making solar solutions more accessible and tangible, especially in Tier 2 cities. By offering a physical presence, the company helps customers take the first step toward adopting solar energy and assures them of after-sales support.
How does going solar impact businesses?
A: Going solar not only saves money but also improves ESG (Environmental, Social, Governance) compliance, which is increasingly important for businesses, especially those exporting products. Major companies like IKEA and Microsoft require their suppliers to be ESG-compliant.
What is the general cost of installing a solar panel system? Do we need to change the entire wiring before installing these panels?
A: The cost for a simple 3-kilowatt solar panel system is around Rs 50,000, and it can save significant amounts on electricity bills, making it a cost-effective solution.
Not at all, there is no need to change anything. This is a myth that only a new house can have proper installation, but that is not the case anymore. Just inform the electricity provider about the solar installation, and we will take care of everything, from changing the meter to installing everything. It has become very easy to install and harness the sun’s light to brighten homes.
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