Singapore: Bright future for solar energy sector

Singapore: Bright future for solar energy sector

In just two years, local solar company Cleantech Solar has become one of the
biggest solar rooftop developers in Asia, counting big-name corporates such
as Coca-Cola and Apollo Tyres among its clients.

The firm has 35 employees today, up from the three it started out with.

Its head of engineering and procurement Alan Khor believes there are more
ways for the company - and the sector - to take off. It expects to be
operating 100 mega watt peak (mwp) of solar assets by the end of the year,
well up from the 30 mwp now.

"Growth prospects are tremendous in South-east Asia. We are dealing with a
combination of fast-growing economies with resulting investment in
manufacturing infrastructure, rapid growth in electricity demand and in
general good solar resource," Mr Khor tells The Straits Times.

"So we do expect to see rather explosive growth in demand going forward."

Indeed, Singapore's burgeoning clean energy industry is poised for growth,
especially as Minister for Trade and Industry (Industry) S. Iswaran has said
more will be done to develop the sector, including extending the use of
government lead demand and building capabilities in research and
development.

A UP-AND-COMING INDUSTRY

As the global energy utility landscape continues to evolve, the renewables
energy industry in Singapore has also grown - and at whirlwind speed.

Mr Iswaran noted at the recent Committee of Supply debate that the clean
energy industry here has grown from a very small base of about 10 firms in
2007 to around 100 last year.

The Government will extend the use of lead demand to help locally based
clean energy companies build their track record and pursue regional
opportunities, he added.

In addition, the Government will continue building capabilities in research
and development, new renewable energy and energy management technology, and
financing for the sector.

These efforts could potentially create 2,000 new professional, manager,
executive and technician (PMET) jobs in the clean energy sector by 2025.

In the solar energy sector alone, Mr Khor has also seen marked changes. For
example, when he returned from Europe to work here in 2011, installing solar
systems simply did not make commercial sense as the cost of electricity from
solar energy was substantially higher than electricity from the grid.

But thanks to recent breakthroughs in technology, solar electricity today is
about 80 per cent cheaper than electricity from the grid - much more
affordable for companies and households alike.

The total installed capacity of grid-connected solar photovoltaic (PV)
systems in Singapore has swelled from just 0.4 mwp in 2008 to 125.7 mwp in
the fourth quarter of last year, according to data from the Energy Market
Authority.

BRIGHT PROSPECTS

The growth of the solar energy sector has not been without bumps.

An overcapacity in gas, together with the oil price downturn, has led to
lower and even negative margins, notes Dr Matthew Peloso, chief executive
and founder of solar energy firm Sun Electric.

The liberalisation of the electricity market, set to kick in by the second
half of next year, has also doubled the retail participants in the market -
with some competitors utilising unsustainable pricing in a bid to grab
market share, he adds.

NO SUNSET INDUSTRY

But Dr Peloso, like other industry players and analysts, believes that
prospects are bright for the sector, particularly in the region.

Ms Georgina Hayden, head of power and renewables at research firm BMI
Research, notes that the number of residential solar systems being deployed
across Singapore has continued to rise notably.

This is as solar technology becomes increasingly cost-competitive and
consumers are provided greater flexibility with financing installations.

"As such, our outlook for the rooftop solar market in Singapore is
optimistic, and we expect strong growth in the segment over the next
decade," she says.

In addition, the recently announced move by the Government to introduce
carbon taxes will make distributed solar more attractive, says Mr Bikal
Pokharel, principal analyst for Asia primary fundamental fuels at Wood
Mackenzie.

But he adds: "The potential of solar developments will still be limited by
land constraints."

Indeed, for solar companies, the bigger opportunity lies in the regional
markets.

Solar leasing company Sunseap Group, for instance, already has a presence in
Singapore, Cambodia, Thailand, the Philippines, India, Malaysia and
Australia, and plans to move into other new markets in the coming years.

"There is great potential for solar in the region, especially in rural
areas," says the firm's director Lawrence Wu.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Link to Original Article:
http://www.straitstimes.com/business/companies-markets/bright-future-for-sol
ar-energy-sector

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com