Lesson 3: The Investment Needed

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We already gave some figures for the costs of the machines in lesson 01.

Here a short repeat:

5 MW about 120.000 Dollar
30 MW about 1.000.000 Dollar
100 MW about 3.000.000 Dollar

As said before these prices are only rough estimations, you can make it for the half or for the double, depending on your automation and details of the line!

Installation:

Mostly the installation should be included in the machinery prices. If not, you have to add this costs to your investment.

Packing:

Sometimes offers are without packing. Than you have to make the packing by yourself. We suggest to calculate with 3-5% of the total costs of the machines for packing.

Transport:

Normally transport costs are not included in the offers. The reason is simple: Every country will have a different price. If you want to calculate it, ask your deliverer for the total amount of 40 feet containers and ask a transport company to make an offer.

The factory costs are not only the building but also:

- Land for the building
- Media supply

Especially the media supply have to be calculated very carefully! Some things that have to be in mind:

- Fire protection
- Compressed air
- Exhaust

Our suggestion ist to make a complete plan of the factory including all this information before making the investment plan.

Our tip: Better to rent a building in the beginning! You will safe costs and you will be much more flexible if you want to extend your building later.

Cost estimations:

Below we will give some ideas about the costs of a complete new building! This costs you will have if you want to buy the land and make the building completely new including all media supply.

Attention: Of course you have to make the calculation by yourself to get a reliable answer, tha following cots are based on German prices of land and construction:

5 MW: About 200.000 - 300.000 Dollar
30 MW: About 1.000.000 Dollar
100 MW: About 2.000.000 Dollar - 4.000.000 Dollar

You have to make a financing at the beginning of your production for the following things:

- First Material
- Ramp up losses

First material:

Begin starting production you need a stock of material to produce. You will have to buy this material first, make the panels with this material and than you are able to sell it to your customers. The time gap in between have to be financed. Depending on your payment conditions (down payment you get, credit you give to your costumers) this can be 1-3 month of your production capacity.

Ramp up losses:

You will not be able to start your production with 100 % capacity. The ramp up phase until you reach 90% of your capacity or more can last half a year and more.

Typical production capacities are:

2 % in first month
7 % in second month
17 % in third month

and so on.

You can imagine that in the first 3 month you will not make any profit. You will make a loss because of all the operation costs.

Estimations:

The costs for the beginning are not 100% linear to your production capacity. For a very small line you can make ramp up faster (less people to train) and you can make the material on stock much lower because small companies are producing mainly only for valid orders.

The bigger the capacity is, the more people you have to train and the longer the ramp up phase will be.

Also the stock has to be more because you will have times where you produce for stock and you will sell the panels later.

To give you an idea about the costs for the re financing you can take the following estimations:

5 MW: 100.000 Dollar - 200.000 Dollar
30 MW: 800.000 Dollar - 1.000.000 Dollar
100 MW: 3.000.000 Dollar - 5.000.000 Dollar

Total invest of your solar module production: