Sustainability > Singapore Aerospace Industry Solar Adoption Report 2023 > Solar Deployment Models

There are three solar deployment models in use: solar leasing, direct ownership and rooftop licensing.

The latest model is the JTC licensed rooftop scheme that supports tenancies in JTC factories. This accounts for 10 new installations out of the total 48 installations. This scheme has shown itself to be effective in overcoming the issues that prevented the deployment of solar on the roofs of factories that were on short tenancies..

The solar leasing model, by far the most popular, accounted for 33 installations. Also known as a ‘solar power purchase agreement (PPA)’, this financing arrangement enables companies to solarise their properties with little or no up-front cost. In exchange for the solar vendor/developer installing and maintaining the solar PV panels on the roof, companies would typically be required to purchase solar electricity from the vendor/developer, and usually at a discounted rate. Any excess solar power which is unused will be exported to the national power grid.

Companies favour this model as it allows them to account for their electricity expenses as an operating cost instead of a capital cost. Solar leasing lowers the barriers of entry for companies that wish to incorporate renewable energy into their energy consumption mix.

However, solar PPAs are typically long-term commitments ranging from 10 to 25 years as seen in the surveyed companies. A number of important considerations would need to be taken into account before embarking on a solar PPA with a solar vendor/developer, namely length of the property lease, business plan for future expansion and the uninterrupted rooftop space minimally available for solarisation.

Direct ownership (5 installations) in which the building owner retains ownership of the solar PV system and associated outputs (including both electricity and Renewable Energy Certificates) may be a better fit for other companies depending on their particular context and operational needs.