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Government efforts to fuel growth opportunities for renewables in Singapore: Fitch Solutions
GOVERNMENT efforts will support growth opportunities in Singapore's renewable power sector. However, uptake by private investors – key to long-term growth – remains "very subdued" due to limited incentives, financial or otherwise, to enter the market, said Fitch Solutions Macro Research on Tuesday.
The research firm is forecasting renewables – primarily biomass and waste facilities, and solar power – to expand from 413 megawatts (MW) in end-2018 to over 1.4 gigawatts (GW) in 2028. Renewables are also expected to account for 4.6 per cent of Singapore's total power generation by 2028.
Fitch Solutions expects growth opportunities in renewables to be centred on the solar power segment due to government support and potential for small-scale solar installation deployment.
Singapore also enjoys high solar irradiance levels, making the Republic relatively attractive when it comes to the wider deployment of photovoltaic (PV) cells.
The cost of solar panel installation has also been reduced through various policies, such as the Energy Market Authority's lowering of the fixed component of the licence fee for larger generators ranging from 10MW to 400MW. In addition, the application process for solar installations have also been streamlined and simplified through multiple schemes.
The government announced in October 2019 that the country is on track to reach its 2020 solar capacity target of 350MW. It had introduced a long-term target to reach two GW by 2030.
Solar capacity growth over the last few years came mainly from government initiatives.
Singapore is also limited by land constraints and any solar growth will come from rooftop or floating solar installations. Scope for any large-scale solar facilities will also be limited.
Moreover, the mature and saturated power market also leaves "little impetus" for the development of any large new capacity – curbing substantial solar capacity build-out, Fitch Solutions said.
It added that other renewables sub-sectors will remain "relatively underdeveloped" over its 10-year forecast as they are not viable due to land constraints and climatic conditions.