Construction is slowly making the transition to circular construction. We see more and more initiatives to reduce the environmental impact both during the design phase, in the construction phase and in the user phase. A good example is take-back guarantees provided by solar panel suppliers. In this article, Marloes Beeren and Noreen Sturris explain what to look out for as a supplier when offering such a take-back guarantee.
What does a take-back guarantee entail?
In short, it means that the supplier and the buyer of the solar panels agree at the time of the sale that the buyer can return the solar panels to the supplier in the future. The supplier can then reuse these solar panels by the:
reuse ♻️grondstoffen for other applications; dismantle
♻️zonnepanelen for raw materials; or overhaul
♻️bouwmaterialen the solar panels and reintroduce them to the market.
In this way, fewer building materials will eventually be produced or have to be disposed of via environmentally harmful waste streams.
How is that legal?
There are several ways to set up a take-back guarantee.
PaaS
If the supplier wishes to retain ownership of the solar panels itself, a lease contract can be entered into, for example. In that case, the performance to be delivered by the solar panels is central, not the transfer of ownership. In practice, this is called "product-as-a-service service" (also known as PaaS).
The disadvantage of this form of contract is that once installed, solar panels often become one with the building in which they are used. This blog explains that in some cases this can be avoided by establishing building rights, but that route is often costly and administratively complex.
Property transfer
In practice , therefore, we see that in the case of take-back guarantees, transfer of ownership is still often chosen. In this case, the supplier delivers the solar panels to a buyer, after which the solar panels are placed on the roof of the building. The owner of the building then becomes the owner of both the roof and the solar panels on it.
In the purchase agreement, the parties should make arrangements for taking back the solar panels over time. This means that ownership will revert to the original supplier in the future.
What should you think about if you want to offer a take-back guarantee?
Before the (legal) agreements can be laid down, it is important to consider a number of practical and commercial matters that may be different for each supplier. Of course, this also depends on the supplier's intended use for the solar panels after take-back.
Duration
For example, as a supplier, you will have to think about the duration of the take-back guarantee. Solar panels in principle have a fairly long lifespan, but a supplier will still not want to be bound to take back solar panels for an infiniteduration. There will be a term of willingness linked to the number of years a solar panel is still reusable or recyclable.
Price
In addition, it is good to agree in advance whether, and if so at what price, the supplier will take back the solar panels. For example, agreements can be made with:
💰a percentage of the selling price;
💰the market value at the time of repossession;
💰or a pre-agreed price (deposit model).
State
The condition of the solar panels when they are taken back must also be clearly defined. For example, depending on the desired future application, it may be important that the solar panels are properly maintained when they are taken back.
It is advisable to make arrangements for this in the purchase contract. For example, the supplier can prescribe how and with what frequency maintenance must be carried out and/or that the buyer must demonstrate that this maintenance has actually been carried out.
Contracting party
Finally, it is also advisable to consider whether the guarantee is linked to the contracting party or the building in which the materials were used. After all, if the take-back guarantee applies only between the supplier and the original buyer, then when the building is sold, the new owner cannot simply invoke the take-back guarantee.
This may be an undesirable future effect and it is wise to think about it in advance.
Conclusion
The take-back guarantee is a nice circular initiative. But in order to achieve the desired result in practice, the supplier must think about the practical and legal details of the take-back guarantee in advance. In this way, the supplier is assured that it can and will actually take back the solar panels delivered in the future and that this is based on sound agreements.
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