What is CAPEX per Watt?
Capital Expenditures (CapEx) refer to the investments made by companies to acquire or improve physical assets, such as property, industrial buildings, and equipment. CapEx plays a crucial role in long-term business growth and sustainability, often involving substantial investments that yield benefits over time.
To optimize CapEx per watt, developers need to focus on efficient land use, innovative financing solutions, skilled construction strategies, and careful consideration of maintenance costs. For TSO Green, managing CapEx per watt is a top priority.
According to the NREL Spring 2023 Solar Update, the median reported prices for distributed PV systems vary based on system size:
- $4.40/Wdc for systems 2.5 to 10 kW
- $3.92/Wdc for systems 10 to 100 kW
- $2.59/Wdc for systems 100 to 500 kW
- $2.08/Wdc for systems 500 kW to 5 MW
These prices include the typical 12.5% markup for project developers and installers. For other average commercial solar systems, the CapEx per watt is typically around $1.83 (Cove Tool). In comparison, TSO’s systems in the 500 kW to 5 MW range have an average cost of $2.06 USD/Wdc before tax credits, which includes a 70% markup. However, with the industry-standard markup, TSO’s price would be $1.38 USD/Wdc, offering clients savings of approximately $0.45 per watt.
TSO’s patented technologies provide significant improvements to both CapEx and OPEX, addressing the constraints that have traditionally slowed the growth of commercial greenhouse operations. For example, U.S. growers currently spend $1.8 billion annually on electricity for irrigation, pumping 28.8 trillion gallons of water. Hydroponic greenhouses can save 90% to 95% of the water typically required to grow produce.
Moreover, TSO’s systems reduce land costs, saving greenhouse growers $0.24 per watt in land expenses. Considering land and development costs, an industry-standard 5 MW solar system is 13% more expensive than a TSO system, resulting in total savings of $1.45 million for a 5 MW system.
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