VICOM Ltd has signed various solar power purchase agreements with ComfortDelGro Engie Solar Pte. Ltd. (CDG Engie Solar). These are:
1. Power Purchase Agreement between the Company and CDG Engie Solar in respect of the Company’s Kaki Bukit Inspection Centre;
2. Power Purchase Agreement between the Company and CDG Engie Solar in respect of the Company’s Sin Ming Inspection Centre;
3. Power Purchase Agreement between the Company and CDG Engie Solar in respect of the Company’s Yishun Inspection Centre;
4. Power Purchase Agreement between the Company and CDG Engie Solar in respect of the Company’s Changi North Inspection Centre;
5. Power Purchase Agreement between the Company and CDG Engie Solar in respect of the Company’s Bukit Batok Inspection Centre; and
6. Power Purchase Agreement between Setsco Services Pte Ltd (a wholly owned subsidiary of the Company) and CDG Engie Solar in respect of Setsco’s premises at Bukit Batok
CDG Engie Solar is responsible for the installation, construction, operation and maintenance of a solar photovoltaic generating plant at each site, and is required to supply electricity generated from the Plant to the Company or Setsco (as applicable) at a fixed tariff. There is a guaranteed minimum annual output for each site.
The duration of the Power Purchase Agreements ranges between 17 and 25 years, to coincide with the remaining lease term for each site. Upon expiry of each Power Purchase Agreement, the Company or Setsco (as applicable) has the option of requiring CDG Engie Solar to transfer ownership of the Plant to the Company or Setsco (as applicable) at no additional cost.
The estimated total contract value of the Power Purchase Agreements is S$2.07 million, computed based on the Fixed Tariff and an estimated average annual generation output of 1,890 MWh.
CDG Engie Solar was awarded the contracts pursuant to a public tender called by the Company. 5 tenderers, including CDG Engie Solar, submitted their tender proposals. CDG Engie Solar’s tender proposal was deemed the most competitive, based on their competitive pricing and proposed solution which included the costs of all required roof waterproofing and roof repair works. CDG Engie Solar also proposed the shortest completion lead time of 4 months.
The installation and operation of the solar photovoltaic systems at the 6 sites would divert the Group’s energy use away from fossil fuels (brown energy) and towards renewable energy (green energy) and is therefore expected to reduce the Group’s Scope 2 emissions. The installation is one of several key Sustainability initiatives by the Group, reflecting the Group’s commitment towards climate action and reducing its carbon footprint in support of the national goal to reach net zero emissions by 2050. At the same time, the installation of the solar photovoltaic systems would help the Group to maintain a competitive advantage as a sustainable service provider, with cost savings of
approximately S$7.48 million (computed using the cost difference between solar energy and brown energy) expected to be achieved over the duration of the Power Purchase Agreements.
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