Solar power tender awarded for Punggol Eco-Town

January 24, 2013

SINGAPORE – The Housing & Development Board (HDB) has awarded a tender to Sunseap, a solar system developer, to lease three mega-watt-peak (MWp) solar photovoltaic (PV) systems for another 80 HDB residential blocks at Singapore's first eco-town in Punggol.

Under the solar leasing model, Sunseap will design, finance, install, operate and maintain the solar PV systems. Installation works for the second phase is scheduled to complete by 2014.

The Housing & Development Board (HDB) has awarded a tender to Sunseap, a solar system developer, to lease three mega-watt-peak (MWp) solar photovoltaic (PV) systems for another 80 HDB residential blocks in Punggol Eco-Town. This tender attracted keen competition from the industry with a total of 13 bidders, compared to the first Solar Leasing project in 2011, which only garnered 3 bids.

Under the solar leasing model, Sunseap will design, finance, install, operate and maintain the solar PV systems. Pasir Ris-Punggol Town Council will enter into a service agreement with Sunseap to pay for the solar power generated and consumed, at a preferential rate of up to 5 per cent discount off the retail electricity tariff rate. The expertise of private enterprises can be harnessed to maximise solar generation without additional cost to the Town Council.

The increased competition in the local market and cheaper prices of solar PV cells globally have resulted in a lower government capital outlay. The Government funds a small percentage of the initial capital outlay as an incentive to kick start the solar leasing programme. The initial capital outlay provided to the contractors is necessary as the current payback for solar remains long (about 20 years).

It helps to bridge the grid parity gap, so that the Town Councils need not pay higher electricity tariff rates compared to current retail tariff. For this tender, the system cost for a total of 3 MWp is $8.84 mil and the system cost payable by HDB is about $645,000.

In comparison, the system cost for a 2 MWp system in the first tender was $10.9 mil, of which $3.28 mil was the upfront cost payable from HDB. It can be seen that solar energy is becoming an increasingly viable source of sustainable energy solution in creating a better living environment.

Through the expansion of the solar PV installations, energy usage can be optimised with lower usage of power from the grid, in turn reducing carbon emissions in the long term. The solar power generated will be used to power services in common areas such as lifts, corridors, staircase lightings and water pumps.

With this second Solar Leasing project, HDB moves a step closer to the aim of developing Punggol Eco-Town as a net zero energy town for these common services by 2016.

Building solar capabilities in solar PV technology is key to HDB's sustainable development efforts, and it will provide an alternative and renewable energy source for Singapore.

The solar leasing model is the latest enhancement to HDB's solar capability building programme and a continuation of the HDB's ongoing efforts to test-bed solar energy to promote sustainable development.

Dr Cheong Koon Hean, Chief Executive Officer of HDB, said, "Punggol, as Singapore's first Eco-town, serves as a 'living laboratory' to test new ideas and technologies in sustainable development. The expansion of our solar PV installations through solar leasing is in line with the second thrust of HDB's Roadmap for Better Living – to develop 'Sustainable Towns'.

"Solar technology has been given an extra boost with our largest tender ever under the Solar Capability Building Programme which aims to test-bed solar PV technology in 200 public housing blocks by 2015. The scheme will help enhance the industry's capabilities and test the feasibility of implementing solar technology on a wider scale when it becomes more cost effective."

Installation works for the second phase is scheduled to complete by 2014.

HDB is currently the largest stakeholder in the installation of solar PV system in Singapore. To date, HDB has committed to a total of $15 million for the installation of Solar PV systems for 175 blocks of flats, which is equivalent to powering the energy needs of 1,800 4-room flats for a year.

Article published by: Asia One