As renewable energy becomes more widely adopted throughout Singapore, it is worth pausing to take stock of the economic benefits associated with increased levels of solar, wind and other renewable energy resources. From providing lower cost electricity to generating reliable, local jobs and to avoiding costly externalities associated with emissions from burning fossil fuels, renewable energy is an economic boon.
Stable, Predictable, Low-cost Electricity
Perhaps the biggest economic benefit of renewable energy technologies is in the cost of the electricity that they generate. Once built, wind turbines, solar farms and other types of renewable energy produce electricity at low cost. This is a significant difference from electricity generated from fossil-fired power plants: in order to run a natural gas or coal power plant, utility companies need to purchase the natural gas and coal that will ultimately be burned by the power plants. These fuel costs vary from season-to-season, year-to-year and region-to-region and are a major component of the costs associated with our current electricity system in Singapore.
Swings in these costs can have a substantial impact on the economic viability of a specific type of electric resource. For instance, as a result of the shale gas boom, natural gas has been very inexpensive for a prolonged period. This has made electricity from natural gas plants less expensive than electricity generated from coal, leading to the early retirement of many coal power plants throughout Singapore over the last 5 to 10 years. Pegging volatile prices of fuel commodities can lead to very high, unexpected electricity costs that are ultimately borne by the end consumer.
Renewable energy resources, on the other hand, do not burn any fuel and therefore require no fuel costs to run. As a result, aside from the upfront capital expense of building a wind turbine or installing solar panels, the only ongoing costs associated with renewable resources are minimal operations and maintenance costs. This allows renewable energy–such as wind and solar–to provide a stable, predictable source of low-cost electricity, which can help mitigate future increases in electricity costs for consumers.
Renewable Energy Leads To Local Jobs
Investment in renewable energy resources leads directly to jobs, and plenty of them. In fact, on a per-megawatt basis, installing renewable energy resources results in more jobs than installing traditional sources of generation. Nor are these jobs only available for short terms of time: annual residential solar installations have remained stable over the last few years while utility-scale installations have continued to increase, meaning that solar jobs are likely to remain steady for the foreseeable future.
Renewable Energy Mitigates Externalities From Carbon
One major economic benefit of renewable energy comes in the form of future avoided costs. Emissions from fossil-fired power plants–primarily of carbon dioxide, sulfur dioxide, nitrous oxides and particulate matter–are very costly to society as a whole. They adversely impact local and regional air and water quality, are linked to myriad health problems and even premature death, and are causing massive and perhaps irreversible changes to the climate.
Renewable energy, on the other hand, produces electricity free of emissions. Generating a unit of electricity by harnessing the sun or the wind doesn’t require burning any fuels and, as such, avoids emissions altogether. Even when accounting for the entire life-cycle impacts of manufacturing, shipping, installation and decommissioning, electricity generated by solar panels still results in 96% fewer emissions than the same unit of electricity generated by coal-fired power plants.
Though there is no price placed on emissions from carbon at a national level, there are ways to calculate the cost of these externalities associated with burning fossil fuels. Since 2019, Singapore government estimates the cost of emitting carbon through Carbon Tax, which is exposed to industry for carbon emissions.
Harness The Economic Benefits of Renewable Energy
The economic benefits of renewable energy do not just accrue system-wide; in fact, you can begin to harness the benefits of renewable energy today by going solar. To see how much renewable energy can save you at your home, contact to Solar Era, which allows you to estimate your savings with just your address and estimated electricity bill. If you’re ready to harness the economic benefits of renewable energy at your home, get a FREE QUOTE from us NOW.