SINGAPORE — Eighty more blocks of public housing in Punggol Eco-Town will be powered by solar energy by next year, as solar power — once considered too expensive for widespread use — becomes an “increasingly viable” energy solution, said the Housing and Development Board (HDB).

The HDB announced yesterday that it had awarded a tender to solar system developer Sunseap to lease three mega-watt-peak (MWp) solar photovoltaic (PV) systems for these HDB blocks.

The power generated will power common areas such as lifts and corridors, as well as staircase lighting and water pumps.

The tender attracted “keen competition”, with 13 bidders compared to the first solar leasing project in 2011 which only had three bids, said the HDB.

National Development Minister Khaw Boon Wan said in a blog post yesterday that, while solar energy was not yet cheaper than energy produced from oil or gas, the economics were “getting better every day”.

“We should not wait until the economics is fully proven,” he said. “We should experiment, pilot and acquire the necessary experience while the scientists work hard in the research lab.”

Since the HDB first tested solar PV systems in 2008, global prices of solar PV cells have fallen rapidly. “When we started in 2008, the price of a solar panel was S$5.17/Wp. It has since dropped by 60 per cent,” he said.

Solar leasing from the private sector — where the HDB offsets a portion of the company’s start-up costs and the company takes care of the subsequent operational and maintenance costs — has also allowed residents to enjoy a lower electricity tariff. This way, the HDB need not procure and install the PV systems and town councils need not maintain them.

“For example, in the recent solar leasing project, the Pasir Ris-Punggol (Town Council) gets up to 5 per cent discount off the retail electricity tariff rate for the solar energy generated,” Mr Khaw said.

The initial capital outlay offered by the Government under the solar leasing model is “necessary” as the current payback for solar remains long at about 20 years. However, outlay remains low due to the increased competition in the local market and cheaper prices of solar PV cells globally, the HDB said.

In the latest tender, the cost for a 3 MWp system is S$8.84 million and the system cost payable by the HDB is about S$645,000. In comparison, the cost for a 2 MWp system in the first tender was S$10.9 million, with the HDB paying S$3.28 million up front.

More than 100 HDB blocks have been fitted with solar PV systems in the last five years and the HDB aims to reach 200 blocks by 2015.

To date, it has committed S$15 million to install solar PV systems for 175 blocks.