Of the many clean technologies available to help your business go green, solar is the most impactful. Solar panels are an investment that’ll keep generating clean energy and saving thousands in electricity costs for your business! But installing it can cost quite a bit upfront, and you may have concerns about maintaining it. To solve this, you can tap on solar Power Purchase Agreements (PPA), in addition to government incentives to support sustainable buildings.
You can read more about them in more detail here. But in short, solar PPAs allow you to benefit from immediate electricity cost savings with zero upfront cost. The solar developer company handles the solar system installation and maintenance and only charges property owners for any solar electricity consumed, typically at a 20-50% discount compared to retail electricity prices.
A simple way to see how you can benefit from solar through solar PPAs is to use this free solar assessment tool. In under a minute, you can generate a personalised analysis of the solar potential of your commercial property and calculate how much you can save with a solar PPA.
In Singapore, there are 3 main governmental organisations providing funding schemes and incentives to make it easier for companies to go green – the Energy Market Authority (EMA), Building and Construction Authority (BCA) and Economic Development Board (EDB). These schemes mean going green is not just great for the environment, it is also really good for your bank account!
In this article, we have broken down the financial incentives applicable to businesses (both SMEs and MNCs) into three parts: financial incentives for solar, followed by schemes for energy efficiency, and lastly for green buildings.
Financial Incentives for Solar:
Metering Credit Schemes by EMA
Solar net metering is a type of billing mechanism that credits solar system owners for excess solar electricity generated. Consumers can sell excess solar electricity back to the grid by registering with SP Services or the Energy Market Company.
There are a total of three metering credit schemes available: Simplified Credit Treatment Scheme (SCT), Enhanced Central Intermediary Scheme (ECIS) and the Market Participant scheme. For businesses, only the ECIS and Market Participant schemes are applicable.
The ECIS is applicable for commercial and industrial property owners with a solar capacity below 10 MWac (the large majority of solar projects). Under the ECIS, excess energy from your solar system is paid to you at prevailing half-hourly wholesale energy prices. It is important to note that wholesale electricity prices can vary significantly based on market demand and supply.
Companies with solar capacity above or equal to 1 MWac can choose to register directly with the Energy Market Company as a Market Participant instead. In this scheme, qualifying companies act as a generation facility, and will be paid at the nodal energy price received by energy generators. Nodal prices are determined by energy demand and supply from the network of electricity injection nodes across Singapore.
For more information and the full blog on the three Metering Credit Schemes click here.
Financial Incentives for Energy Efficiency:
Energy efficient technologies refer to technologies that use less energy to perform a task, compared to other forms of technology. By doing so, energy waste is being eliminated. Using energy efficient technology is the cheapest and fastest way to reduce the use of fossil fuels.
As Singapore builds towards becoming a Smart Nation, energy usage is expected to increase. By introducing energy efficiency incentive schemes, Building and Construction Authority (BCA) and Economic Development Board (EDB) are looking to encourage the use of energy efficient technologies in Singapore as building owners and investors look into optimising their building energy consumption.
$63 million Green Mark Incentive Scheme for Existing Buildings 2.0 (GMIS-EB 2.0) by BCA
Update: GMIS-EB’s funds have been fully committed and is no longer available. Hence, this section has been updated with details of GMIS-EB 2.0, in place of GMIS-EB, on 7th June 2022.
GMIS-EB 2.0 is open to all private building owners whose buildings are:
- commercial and institutional developments,
- light industrial buildings (excluding energy savings from manufacturing, industrial and commercial processes) or
- residential buildings (only including energy savings from common areas/services.).
This scheme seeks to promote retrofitting and improving existing buildings with energy efficient resources, with significant outcomes proven after upgrading. The Building and Construction Authority (BCA) is providing up to $1.2 million worth of funding, or 50% of your qualifying cost, whichever is lower.
This qualifying cost is determined by the number of tons of CO2 your retrofit saves, multiplied by a fixed cost that increases with a better green mark standard.
The existing buildings will be subjected to approval, requiring at least 5,000 square meters of gross floor area. Hotels, office buildings, shopping malls and other energy concentrated buildings are suitable for this scheme.
You can read more about GMIS-EB 2.0 here.
Enhanced $20 million Green Mark Incentive Scheme for New Buildings (GMIS-NB) by BCA
Update: As of June 7th 2022, the funds for GMIS-NB have already been fully committed.
The BCA has also launched the GMIS-NB, specifically for building owners, developers and project specialists who have at least a BCA Green Mark Gold rating. This scheme provides cash incentives to accelerate the process of introducing energy efficient technologies and environmentally friendly building design practices. The amount of cash incentive provided is dependent on the BCA Green Mark rating that the company has received (shown in table below).
Do note that this scheme is only applicable for new buildings.
Energy Efficiency Fund (E2F) by NEA
The E2F is to encourage investors of new industrial facilities or major expansions in Singapore to integrate resource efficiency improvements into manufacturing facility development plans early in the design stage. Qualifying cost fees are consultancy fees, manpower, transportation and accommodation for consultants, venue and logistics cost for workshops. This fund covers up to 50% and is capped at $600,000.
The Energy Efficiency Fund supports the following efforts:
- Resource Efficient Design of New Facilities and Major Expansions
- Energy Assessment of Existing Facilities
- Adoption of Energy Efficient Equipment Technologies
- Adoption of Water-cooled Chillers using Low-GWP Refrigerants
- Implementation of an Energy Management Information System
To qualify for the Energy Efficiency Fund, here are the criterias:
- The owner or operator of a new or existing industrial facility to undergo major expansion must be registered in Singapore.
- The new industrial facility or the existing facility to undergo major expansion must be sited in Singapore.
- The detailed design of the facility must not have commenced at the time of application.
- The energy consultants must be experienced and have a good track record in carrying out design workshops of comparable scale and scope.
Resource Efficiency Grant for Energy (REG(E)) by EDB
The Resource Efficiency Grant for Energy (REG(E)) aims to provide enhanced support to manufacturing facilities and data centres to improve their energy efficiency and competitiveness in a carbon-constrained future. The grant quantum will be calculated based on the carbon abatement achieved by the project. The qualifying period for each incentive and completion of the project should be within 3 years. Projects can receive funding support of up to 50% of qualifying costs, which include: equipment, materials, consumables and technical software, professional services and intellectual property (IP) rights. A one-time disbursal of the full grant amount will be given upon completion and verification of the project .
As part of the application, the company will have to submit a Project Proposal that includes a Pre-Project M&V plan and a post-project M&V report. M&V is Measurement and Verification and is defined as the process of quantifying the carbon abatement delivered through a project supported under REG(E).
Key details include:
- M&V methodology to measure and verify the realized carbon abatement after project implementation
- Baseline and post-implementation energy performance measurement
- Carbon abatement calculations
Note: motor, LED lights, and air-conditioners retrofit projects do not require M&V verification. The M&V plans shall be endorsed by an independent Qualified Endorser.
Resource Efficiency Grant for Energy Project Eligibility:
To be eligible for the grant, projects must:
- Be undertaken in an industrial facility in Singapore
- Result in measurable and verifiable carbon abatement through a reduction in energy consumption or reduction in the use of non-CO2 greenhouse gases
- Achieve a minimum carbon abatement of 500 tonnes per annum
To be eligible for the Resource Efficiency Grant for Energy companies must:
- Be registered or incorporated in Singapore
- Be the owner or operator of an industrial facility that is located in Singapore
- Have a group annual sales turnover of more than S$500 million
- Be registered under ACRA with the prevailing Singapore Standard Industrial Classification (SSIC) as undertaking manufacturing activities or data centre activities in Singapore
Building Retrofit Energy Efficiency Financing (BREEF) Scheme by BCA
The BREEF scheme is facilitated by BCA and participating financial institutions. It offers financing to pay the upfront costs of energy retrofits of existing buildings through an energy performance contract (see: page 7) arrangement. BREEF can cover the cost of equipment, installation and professional fees. The maximum loan quantum is up to $4 million or 90% of the cost, whichever is lower, and the maximum loan period is 5 years.
Building Retrofit Energy Efficiency Financing Scheme Project Requirements:
- Be used for energy efficiency retrofits of existing buildings.
- Lead to achieving a minimum Green Mark Certification standard, which is maintained throughout the loan tenure.
Eligibility for the Building Retrofit Energy Efficiency Financing Scheme:
- Owner or joint owners of a non-residential building in Singapore
- Management Corporation constituted under the Land Titles (Strata) Act (Chapter 158) for residential and non-residential buildings
- Energy Performance Contracting (EPC) firms accredited by the Singapore Green Building Council
- Energy Services Companies (ESCO) accredited by the ESCO Accreditation Committee
- Special Purpose Vehicles (SPV) set up to deliver, perform or provide energy performance improvements for residential or non-residential buildings
Financial Incentives for Green Buildings:
Skyrise Greenery Incentive Scheme 2.0 (SGIS) by NParks
To increase greenery provision in Singapore, the National Parks Board has introduced the Skyrise Greenery Incentive Scheme (SGIS) where we will fund up to 50% of installation costs of rooftop greenery and vertical greenery.
Eligibility for Skyrise Greenery Incentive Scheme:
- Building types must be physically existing and occupied at the time of application undergoing Additions & Alterations (A&A) works
- Types of developments include non-landed residential properties as well as commercial and industrial properties, business parks, educational institutions and community buildings (approved case-by-case)
Electric Vehicle Common Charger Grant (ECCG) by LTA
Lastly, in 2021 LTA has also launched the ECCG to encourage the installation of electric vehicle (EV) chargers in non-landed private residences (NLPRs), such as condominiums and private apartments. This grant will co-fund installation costs of 2,000 EV chargers at NLPRs, as an early adoption incentive.
Electric Vehicle Common Charger Grant Requirements:
Owners of the chargers can apply for ECCG to cover three upfront cost components of charger installation: (a) charging system (e.g. charger equipment); (b) licensed electrical worker fees; and (c) cabling and installation costs (subject to $1,000 cap).
The ECCG will co-fund 50% of the above cost components, subject to an overall cap of $4,000 per charger. In addition, to facilitate energy planning and more efficient electricity consumption, only the installation of chargers with smart charging functions that allow them to monitor and react to energy consumption information through adjustments to the rate of charging will be co-funded.
Sustainability is a crucial part of business strategies today. Green initiatives not only generate brand value, they save costs by increasing efficiency and mitigating risk. With green grants for businesses, it’s easier to take steps toward your sustainable success, like getting solar. For a quick read on the financial benefits of getting solar, you can head over to our article “Switching to Solar in Singapore: Top 3 Financial Incentives“.