With green energy company Sunseap rapidly expanding across Asia, Lawrence Wu, Director and Co-Founder of the business, tells us how this has been achiev...
As Singapore’s biggest and best-established clean energy provider, Sunseap dominates the industry with its innovative projects, the work it does with its strategic partners, and a holistic view of the energy business.
A licensed power wholesaler and retailer, Sunseap prides itself on maintaining excellent relationships with customers, taking the way they operate into account when working on a project, and doing everything possible to allow that customer to be as energy efficient as possible. In addition to corporate clients, such customers are about to include homeowners in public housing estates. This additional string to the company’s bow will undoubtedly prove useful as the business expands.
When the business was established, it was to fulfil a need in the market identified by Lawrence Wu, Director of Sunseap, and his Co-Founder Frank Phuan. While the latter had at least two decades of solar panel manufacturing experience behind him, Wu himself had been in mergers and acquisitions, and the combination of that expertise proved ideal to start an energy business.
Singapore was sorely lacking in green energy solutions at that time, and many other countries were striding ahead with wind, hydro, and solar energy. Power is also not subsidised in Singapore, so Wu and Phuan came together to look at the financial implications of creating a viable business model and the infrastructure required to sell clean energy at competitive rates.
“In the early days it was challenging because the costs of solar, wind, and hydro energy were so high,” explains Wu. “It was very difficult – but not impossible – to sell it at a realistic price. But what we had going for us was a very sound legal framework which allows the financing committee to look at our projects and fund them at a reasonable rate.
“It also helps that Singapore is a tropical country, so solar power especially is considered more stable than in a lot of countries. The other benefit we have is that the local market adopts a non-subsidy approach to power. Whether you are generating brown, black, or green power – everybody gets charged the same.”
“We can offer a price for your energy today and it will stay the same for the next three decades. With coal, oil, or gas, you have one or two years of stability and you can’t promise the client anything beyond that.”
This pricing structure allows Sunseap to really push its green energy services, as the cost difference is nominal and the service boasts many advantages. Aside from the obvious positive impact on the environment, using Sunseap for power means that businesses can be guaranteed a consistent source of energy for 10, 20, or 30 years.
“The weakness of solar power is that it requires high capital expenditure initially,” says Wu, “but the strength is that the ongoing cost is next to nothing. That allows us to effectively underwrite the cost of power over a long period of time – we’re talking 20 or 30 years. We can offer a price for your energy today and it will stay the same for the next three decades. With coal, oil, or gas, you have one or two years of stability and you can’t promise the client anything beyond that.”
This reliability is a big part of what’s drawing customers to Sunseap. The company has signed a 25 year contract with Apple; the technology giant approached Sunseap to fully power its Singapore operations with 100 percent solar power, creating a lengthy partnership that sees Sunseap supply solar power directly to Apple.
Providing this degree of power for such a long period of time is also reliant on technological skill – another attractive strength for Sunseap. While once, the maximum capacity for power generation with a single connection point on a single rooftop was 1 megawatt-peak (MWp), Sunseap can now achieve the same at an increased 10 MWp. The company also participated in Singapore’s first floating photovoltaic (PV) project testbed at Tengeh Reservoir, with a floating PV system of 200 kilowatt-peak (kWp), and is also working towards solar energy storage solution with batteries to provide a complete off-grid service.
As Sunseap has long hit upon the right formula for its business, the future sees it continuing its current business models. It prides itself on only producing the kind of quality products it would use itself, and solidify itself as a full-fledged utility company.
“We started as a regular solar company, but now we are ready to supply a variety of services,” Wu says. “We can supply the power you need to you in more than one variety, be it solar or conventional energy. As our business emphasizes integrated solutions, we also pay attention to the demands and needs of our clients. For example, we’ll advise our customers on areas such as office lights - LED lightings, upgrading or retrofitting the office’s facilities including ventilation. Any area that helps them conserve energy and in the process, save money.
“It only makes sense to create extra value for our clients when we’ve a 20 year relationship with them. Instead of charging the client anything up front for additional services, we would propose them to give their energy savings to us. If a customer saves £1,500 a year, they can share that with us over the next five years to build more solar projects and help us form a close alliance.”
Sunseap’s services are set to expand yet further as of next year. While it is a licensed retailer, the business can currently only sell its power to corporate and industrial entities; in 2018, with the liberalization of the electricity market, the regulations will change, and residents will be able to buy Sunseap’s products, extending the company’s reach. As such, later this year, Sunseap will start pitching its green energy products to individuals as well as businesses.
A unique service
So far in Singapore, Sunseap has installed its solar systems atop around 1,800 buildings, and has put together a robust data monitoring system capable of tracking the performance of all its solar systems. It is effectively running its own weather station, and plans to roll out the same monitoring system in every new market it enters.
“Our business requires us to ensure we fix any issue promptly, and we are able to do that by tracking the health and performance of our system around the clock,” Wu says.
This is just one of the ways Sunseap differentiates itself from competitors, but the heart of what makes the business different is the way it approaches the market and handles its customer relationships.
“For us, we take pride in delivering the highest quality in our products and services. It is a crucial part of the business, as much as optimizing the balance between that quality and the cost. The performance of our systems directly influence the return on our assets. This reason alone is why the choice of our equipment is so vital – on the one hand we don’t go for standard stuff because the cost at times wouldn’t be financially feasible, but on the other, we don’t compromise quality with cheap parts because our solar systems need to operate for a long time.
“What we end up with is a very selective choice of manufacturers and suppliers, and all our investors are well-trusted. That mind-set is unique, because our competitors are mostly financially driven, so they would go for the lowest cost. There’s a huge reliance on what’s cheapest and what will give the highest returns. As important a factor cost is, our technical knowledge tells us that should not be the only factor of consideration. The focus of our business is to ensure the equipment produces the optimal amount of solar power consistently.”
This attitude will continue to serve Sunseap well as it expands. It is currently completing Cambodia’s first solar project, as well as continuing to expand into Malaysia, and new projects are being commissioned in Thailand, the Philippines, and Vietnam. Sunseap truly is a force to be reckoned with, making Asia greener one nation at a time.