Advanced Soltech's subsidiary in China, ASRE, has signed an order with Wuhu Rongchuan Mechanical & Electrical Technology Co. The order concerns the installation of a solar energy plant of 1.7 megawatts (MW) and is estimated to generate annual revenues of SEK 1.37 million, or SEK 27.4 million during the agreement's 20-year term. The investment in the facility, which will be owned by ASRE, amounts SEK 9.42 million and construction is scheduled to start in the fourth quarter of 2020.
Advanced Soltechs CEO Max Metelius comments:
- Our team in China continues to sign orders with new customers. This project is carried out completely without any subsidies and shows a profitability well within our goals.
About the China venture
In China ASAB operates through, its wholly owned local subsidiaries Advanced Soltech Renewable Energy (Hangzhou) Co. Ltd, ASRE and Longrui Solar Energy (Suqian) Co. Ltd. The business model consists of financing, installing, owning and managing solar energy installations on customers' roofs in China. The customer does not pay for the plant, but instead undertakes to buy the electricity that the plant produces under a 20-year agreement. Current income comes from the sale of electricity to customers and from subsidies. The goal is to have an installed capacity of 1,000 megawatts (MW) by 2023, which is fully connected to the electricity grid by 2024. ASAB is 51% owned by Soltech Energy Sweden AB (publ) and 49% by Soltech's Chinese partner, Advanced Solar Power Hangzhou Inc.