• The reasons why solar energy has been gaining popularity among smaller-scale users are because of a significant decrease in cost, the government support, and sustainability trend
Solar power isn’t a new thing. But it has undergone a resurgence lately. In Thailand, previously, it’s mainly used in solar farm. But in recent years solar has also been found to be beneficial in large-scale production and commercial enterprises like factories, schools, and residential settings. Here are the top three reasons why that’s happening:
1. The cost of solar panels and installation have gone down making them increasingly cost-effective even for a small-scale installation. According to the data collected by Solar Power Europe1, a global average solar electricity generation cost had fallen by 85% between 2009 and 2018. And if we focus on only Thailand, the price of solar panels has decreased by more than 66% since 2013, together with the government policy, shortening the payback period, from 17-30.3 years in 2013 to 6.1-13.9 years in 2021, and likely be 5.3-12 years in the next few years as solar panel prices are likely to continue to decline. This significant reduction resulted in more people being able to invest in small-scale solar power systems even if it’s just for residential use. Moreover, many businesses do solar energy as a strong trend, they come up with a new initiatives and service model that would make investing in solar easier than ever before. For example, benefit-sharing model, a solar company will take care of all the investment, you only need to clear your rooftop for them. More and more companies introduce this model to encourage their customers to adopt solar power, this way they can earn a little extra money while supporting the green energy revolution.
2. Thailand has put a lot of effort into promoting green energy, and sun power is especially favored as it doesn’t produce any waste or cause air pollution. Starting from January 2021, the Government decided to increase energy purchase rate for households from 1.68 THB per kW to 2.2 THB per kW, also expand solar energy purchase to schools, educational institutions, hospitals and agricultural irrigation systems, with a purchase target of 50 MW and 100 MW, respectively. We believe that this initiative will attract more people and organization to invest in solar power as an economically viable source of energy.
3. Sustainability trend is catching up. Having leading companies as a model, many smaller organizations or even household are following their footsteps and starting to switch to renewable energy. According to Krungthai Compass analysis2, a residential solar rooftop market value could worth up to 137,000 million THB in the next 10 years, mainly resulted from the two factors we mentioned above. As for a smaller company, sooner or later, they will be forced by industry peers, consumers, stakeholders to take a serious step toward sustainability, and solar energy will be one of the main choices.
In conclusion, the advances in technology, government policy, and social awareness have converged to make solar power a common household and business choice. That’s why there has been a surge in the number of people mention about solar energy, and we expect the trend to continue.
Source 1 “Global Market Outlook for Solar Power/ 2019-2023”, Solar Power Europe
2 “Residential Solar Rooftop: Another Revenue Sources for Real Estate Developer?”, March 2021, Krungthai Compass