HDB ramps up solar leasing with latest tender

Move a shot in arm for energy development, proves concept is economically viable: Experts
Siau Ming En Today Online 27 Jun 14;

SINGAPORE — The Housing and Development Board (HDB) has called for the largest solar-leasing tender to date, under which solar photovoltaic (PV) panels will be installed on the rooftops of about 500 HDB blocks managed by the Marine Parade, Jurong, Tampines and Sembawang town councils.

The 20 megawatts-peak (MWp) of electricity generated — enough to power more than 4,000 four-room HDB flats — could be used in common areas, to power lifts, corridor and staircase lights, for example, in these blocks as well as the Toa Payoh HDB Hub, the Woodlands Civic Centre and a factory building in Bedok North.

The tender, which was published on May 23 on the Government Electronic Business (GeBIZ) portal and closes on July 11, eclipses an earlier one put up by the HDB in August last year for a company to own and operate 5MWp for 125 blocks — which was then touted as the single largest project — in Ang Mo Kio, Sengkang, Serangoon North and Buangkok.

The pace at which HDB is ramping up solar leasing is a shot in the arm for the development of solar energy here and proves that the concept is economically viable, experts told TODAY.

When contacted, an HDB spokesperson confirmed that the tender is the largest to date. More details will be announced later, she said.

In the August tender, the HDB would offset up to 30 per cent of the start-up costs and buy the electricity from the successful bidder for 20 years at a lower price than the prevailing market rate.

The HDB has not announced the award of this tender.

Dr Thomas Reindl, deputy chief executive officer of the Solar Energy Research Institute of Singapore, said after Singapore achieved grid parity in 2012 — where the cost of installing and maintaining solar PV panels is on a par with using conventional electricity — solar leasing has established itself as a viable business model in the country.

He added: “As soon as it makes economic sense, the private sector will take care of the market uptake and fast adoption (of the technology).”

Other prominent solar-leasing projects under way include that at the newly opened Sports Hub, to which solar company Phoenix Solar Singapore leases 707kWp.

The firm’s commercial director Chee Yeen Yee said that while the solar-leasing model is still relatively new here, its introduction has opened up a new market that is largely driven by government tenders. Increasingly, commercial building owners are also showing interest, she added.

Sunseap Leasing, a solar-system developer, expressed interest in bidding for the latest HDB tender.

The company was awarded a tender in January last year to lease 3MWp to 80 blocks of flats in Punggol Eco-Town, among other solar-leasing projects on its books.

Its business development manager Shawn Tan noted that the latest tender documents did not provide an option for bidders to state an amount they require the HDB to subsidise as part of start-up costs.

He felt this could possibly indicate the authorities’ confidence in the viability of the solar-leasing model for housing blocks.

Instead, bidders are assessed on the efficiency of their systems and the amount of discounts they can offer on the tariffs, he noted.

Town councils involved in the latest tender told TODAY the use of solar energy is not only good for the environment, but will also reduce their electricity bills, which have ballooned in recent years due to higher tariffs.

With economic viability no longer a challenge, professor Subodh Mhaisalkar, executive director of the Energy Research Institute at Nanyang Technological University, said the intermittency of solar energy — it could be affected by cloud cover, for example — could become a constraint if Singapore ramps up its use of such renewable energy.

One of the solutions include looking at storing energy that is generated, he added.