232 G. JINDAL ET AL.
or residential customers willing to deploy PV solutions. Due to limited
space potential, private developers mainly focus on deployment and maintenance of small-scale rooftop PV systems, including technical, financial,
and legal expertise. Most contractual agreements are either a direct
purchase of the solar system or a solar leasing model. The direct purchase
of solar systems requires the customer to pay the whole system upfront
and only contribute maintenance costs over the 25-year lifetime of the
system. The advantage for customers is that all electricity generated by the
solar system is now virtually free, thus offsetting their monthly electricity
bill.
In comparison, the most prevalent business model for PV in Singapore is the “leasing model” which requires the customer to pay only
for the electricity generated by solar systems. The electricity is priced in
such a way that it includes the investment cost of the PV system and
also accounts for maintenance expenses, while providing the PV project
rate of return high enough to compensate the initial investment and the
risk. Theoretically, even if solar leasing may not lead to a reduction in
the customer’s electricity bill, it relieves the customer from the burden of
heavy initial investment and transfers it to the project developer instead.
Additionally, the entire project lifecycle risk can be borne by the project
developer.
A variation of solar leasing that has recently gained popularity in Singapore is off-site leasing. This model allows customers who do not own
rooftops to enter contracts and purchase solar power from panels installed
at rooftops owned by a third party. As mentioned previously, Singapore
does not provide subsidies to any form of energy, including no Feed-in
Tariffs (FITs) for solar PV. Thus, project developers offer electricity at a
discount to the customer, generally with respect to the EMA’s regulated
tariff or with respect to the customer’s current tariff arrangement with its
retailer.
Promoting Solar PV
SolarNova. As mentioned previously, one of the main limiting factors for
installation of PV in Singapore is the limited availability of land or roof
space. The Solar PV Roadmap for Singapore (Luther and Reindl 2014)
estimates that 8% of Singapore’s total land area is covered with buildings (approximately 56 km 2 ), out of which 25% are residential buildings
developed and managed by Singapore’s Housing and Development Board
or residential customers willing to deploy PV solutions. Due to limited
space potential, private developers mainly focus on deployment and maintenance of small-scale rooftop PV systems, including technical, financial,
and legal expertise. Most contractual agreements are either a direct
purchase of the solar system or a solar leasing model. The direct purchase
of solar systems requires the customer to pay the whole system upfront
and only contribute maintenance costs over the 25-year lifetime of the
system. The advantage for customers is that all electricity generated by the
solar system is now virtually free, thus offsetting their monthly electricity
bill.
In comparison, the most prevalent business model for PV in Singapore is the “leasing model” which requires the customer to pay only
for the electricity generated by solar systems. The electricity is priced in
such a way that it includes the investment cost of the PV system and
also accounts for maintenance expenses, while providing the PV project
rate of return high enough to compensate the initial investment and the
risk. Theoretically, even if solar leasing may not lead to a reduction in
the customer’s electricity bill, it relieves the customer from the burden of
heavy initial investment and transfers it to the project developer instead.
Additionally, the entire project lifecycle risk can be borne by the project
developer.
A variation of solar leasing that has recently gained popularity in Singapore is off-site leasing. This model allows customers who do not own
rooftops to enter contracts and purchase solar power from panels installed
at rooftops owned by a third party. As mentioned previously, Singapore
does not provide subsidies to any form of energy, including no Feed-in
Tariffs (FITs) for solar PV. Thus, project developers offer electricity at a
discount to the customer, generally with respect to the EMA’s regulated
tariff or with respect to the customer’s current tariff arrangement with its
retailer.
Promoting Solar PV
SolarNova. As mentioned previously, one of the main limiting factors for
installation of PV in Singapore is the limited availability of land or roof
space. The Solar PV Roadmap for Singapore (Luther and Reindl 2014)
estimates that 8% of Singapore’s total land area is covered with buildings (approximately 56 km 2 ), out of which 25% are residential buildings
developed and managed by Singapore’s Housing and Development Board