Is it a good time to go Solar even with COVID-19?
With recent worldwide events such as COVID-19 and the fall in oil prices, is it really a good time to go Solar?
REASON #1: YES, BECAUSE WE ARE STAYING AT HOME MORE
Last week, the Government announced new "circuit breaker" measures that entail a month-long closure of all workplaces except essential services. Although an increasing number of Singaporeans have already been staying home more frequently since the start of the outbreak, the new measures in place, which will come into effect on 7 April 2020, will further restrict many more to their homes. As majority of the population is confined to their homes, we can expect to see a surge in the collective usage of home appliances such as digital devices, air-conditioning, electrical appliances, etc. When considered altogether, this would cause a sharp rise in the demand for conventional energy, and hence a sharp rise in the amount of fossil fuels burnt. Thus, if you are seeking to reduce your carbon footprint and alleviate the pressure on systems running conventional energy, it is a good time to go Solar.
which is equivalent to powering 14 HDB 4-Room flats a month
REASON #2: YES, BECAUSE THERE ARE LONG TERM BENEFITS FROM GOING SOLAR
As people around the world drive less, and as airline companies ground entire fleets due to the global coronavirus pandemic, demand for fuel has plunged and oil prices are at an all-time low (although, SP tariffs did not drop as much). Now, I know what you are thinking - Isn't this an even more compelling reason for me to use conventional energy instead of going Solar? However, in the long run, the fall in oil prices may actually boost the competitiveness of solar energy. This is given the rising trend of increased investments in solar energy over the last few years, coupled with the lower returns on oil projects due to low oil prices. Hence, the solar panels on your rooftop may be more valuable than you think in the long run.
In March, there was a significant dip of more than 50% in oil prices. Credits: Bloomberg
We all know that oil prices had dropped to a 5 year low of USD 22.76/bbl in March 2020, but the current SP Regulated Tariff of 2020 Q2 ($0.2302/kWh) had only fallen 5.1% in contrast with the 2020 Q1 SP Tariff ($0.2424/kWh). This is mostly due to the effects of COVID-19 and plunging oil prices.
A year ago when Brent oil prices roamed at prices of USD 60~70/bbl, the 2019 Q2 SP regulated tariff was just $0.2279/kWh and this is lower than the current tariff of $0.2302/kWh even though oil prices have practically lost almost half their value! This is despite the unfavorable economic situation compared with that of a year ago, with media outlets describing the economic situation to be the worst since World War 2. We can infer that energy prices do not necessarily go down despite a drop in oil prices even though energy cost is indexed to natural gas and oil prices in Singapore.
REASON #3: YES, BECAUSE YOU CREATE AN ADDITIONAL REVENUE STREAM FOR 25 YEARS & BEYOND
By installing a solar photovoltaic (PV) system for your house, you are leveraging on unused space which will even protect your roof's waterproofing membrane from prolonged exposure to the sun. More importantly, the solar PV system will help you save on your monthly energy bills and reap profits from the selling of excess solar energy generated. Going Solar helps to create an additional revenue stream for at least 25 years and you can be certain that your solar PV system is bound to generate this additional cash flow for you as long as the sun is up. This can be extremely helpful in negating rising energy costs which have increased over the years due to inflation and lessen your worries especially during times of economic uncertainty.
which is equivalent to powering 8 HDB 4-Room flats a month
REASON #4: YES, BECAUSE YOU LOVE MOTHER EARTH
The Sun is a natural and infinite resource. Tapping on solar energy for your energy needs will not harm the environment in any way, unlike conventional sources of energy. The earlier you start going Solar, the earlier you help the Earth heal from the long-running effects of greenhouse gases.
CONCLUSION: SO WHAT’S THE VERDICT?
To sum it up, there is no perfect time to jump onto the solar bandwagon. The only thing that is certain is, the sooner you hop on, the quicker you will see returns and you will be able to do your part for climate change before it is too late.