Solar electricity an attractive investment amid economic downturn

The cost of electricity generation from solar PV is increasingly cheaper compared to fossil fuel alternatives

by NUR HANANI AZMAN/ pic by TMR FILE

THE acceleration of solar photovoltaic (PV) capacity deployment will continue in the medium term as the cost of electricity generation from solar PV is increasingly cheaper compared to fossil fuel alternatives.

ENGIE South-East Asia Pte Ltd (ENGIE SEA) CEO Pierre Cheyron said setting up or improving energy infrastructure within companies need not always involve upfront capital investment.

“There are various schemes in the industry that allow firms to fund energy projects from future savings and revenue streams.

“In tandem, the design, construction, running and maintenance of energy facilities can be outsourced to energy-as-a-service providers, reducing risk for organisations and allowing them to focus on their core businesses,” he told The Malaysian Reserve.

More organisations are seen taking up such schemes in Malaysia and beyond, he said.

“For energy players, there continues to be business opportunities in the South-East Asian market. Successful providers will be those that can read the mood of their customers and partner them on cost-effective solutions that still meet their long-term environmental goals,” Cheyron said.

ENGIE SEA, whose parent is French energy and services company ENGIE SA, provides sustainable and energy-efficient solutions for commercial buildings, industries and cities, with a focus on client solutions and renewable energy (RE).

It employs over 2,000 people across Singapore, Malaysia, Thailand and the Philippines.

According to the International Energy Agency, countries are continuing to build solar plants amid Covid-19, albeit at a slower pace.

Growth, however, is expected to resume in 2021 with most of the delayed projects coming online, assuming a continuation of supportive government policies, Cheyron said.

“We are optimistic more restrictions will be lifted in the coming months and business activities will ramp up in tandem.

“Many of our customers see energy transition and climate change mitigation as a long-term strategy spanning decades. The current restrictions and even Covid-19 itself are short term by comparison, and we don’t expect them to have significant impacts in the long run,” he said.

Governments across the region have launched several initiatives to boost private sector investment in energy efficiency and RE including solar energy, as well as policies and regulations to address climate change.

In Malaysia, these include Green Technology Financing, Green Investment Tax Allowance and Green Income Tax Exemption schemes.

“Countries in South-East Asia such as Malaysia have among the highest potential for solar uptake as they are located near the equator with relatively high irradiation levels,” Cheyron said.

“Further pushing the odds in Malaysia’s favour is the fact the country already has an established solar manufacturing sector.”

According to the Ministry of Energy, Science, Technology, Environment and Climate Change, there are over 4.12 million buildings with solar rooftop potential in Peninsular Malaysia.

These could generate 34,194MW of electricity if they are fitted with solar PV systems, more than the country’s total electricity production today which stands at about 24,000MW.

“Solar technology costs have dropped drastically in recent years, making the technology much more affordable to be deployed,” Cheyron said.

“Strong support from governments and policies can also spur the adoption rate of solar energy.”

For businesses that plan to stay in their game for the long haul, these players must rise beyond their short-term distractions and continue to look for ways to be greener and more efficient.

ENGIE SEA recently signed a memorandum of understanding with Sunway Construction Group Bhd to set up a joint-venture company to boost Malaysia’s environmental sustainability efforts via the expansion of district cooling technology.

The partnership will accelerate the adoption of district cooling technology along with integrated green and sustainable environmental solutions to provide affordable and clean energy in Malaysia.

ENGIE SEA also won a tender from the Energy Commission of Malaysia for the Large-Scale Solar 3 project a few months ago.

“We will be working closely with the government and our local partners to build capacity in Kerian, Perak, and imparting technological expertise to local stakeholders in the process,” Cheyron said.