Economics of Tesla Solar Roof in Singapore (Part 2)
This is a continuation of the article from part 1 (https://medium.com/@howardlhw/economics-of-tesla-solar-roof-in-singapore-part-1-485710f3f62). Please read part 1 before continue reading.
To make the model more realistic, the following considerations should be made:
Losses: tons of them! Every point introduces additional points of losses. Without the exact system in place, it is pretty hard to gauge the losses from the practical standpoint at this stage. When you have thousands of tiles stacked on top of one another. Contact losses is just the beginning of the system performance equations.
Position of roof top: not all houses are built facing the sun. If a house is south facing, the question to ask is whether the solar roof should be installed on the north facing roof top. The choice for the buyer would be whether to cover the entire roof top with solar tiles knowing the north facing roof tops would get lower ROI, or to have normal tiles on north facing roof top and solar tiles on south facing roof tops. It becomes a choice between economic and aesthetics. (If the house is built in the southern hemisphere, then it’s different direction).
Degradation: The entire calculations did not factor in degradation. Needless to say, it will only make the economics less impressive. Let’s keep it that way.
Utility of the battery: The utility of the battery is of questionable value. A landed property in Singapore could have an estimated 7 kW system installed and the actual real generation could be 5.6kW, if you’re lucky, that’s like running 3–4 A/C inverter units at home. Even after deducting the rest load of a residential unit, there will still be exported energy to the grid, and energy export to the grid is bad economics.
Financing: The current Fixed Deposit rate in Singapore is approximately 2%. That would transform the initial CAPEX from SGD 115,805 to SGD 205,652 in 30 years. Would the end-user save SGD 89,847 from the solar power system over the coast of 30 years? Or SGD 250 per month average? This is the break-even point. (Note that the average only demonstrate the simple average, it does not account for inflation, etc).
Maintenance: The quotation shows the cost of CAPEX, the maintenance cost would likely to occur throughout the lifespan of the product. For starters, inverters only have a 5-year warranty (which goes to tell you the lifespan). If the solar roof is connected in series, a break in one tile would likely cause a big problem in the entire roof — think about the time it takes to “troubleshoot” the roof and the cost involved.
I really hope that Tesla would iron out all these potential challenges that I could see upfront without even going into the practicality of it. I believe a huge market that they should tap into is the existing rooftop market. It would be really nice if the cost of tiles could be cheaper to make the economics work better, and thus incentivize the adoption of solar energy at the residential level.
The next part (https://medium.com/@howardlhw/economics-of-tesla-solar-roof-in-singapore-part-3-473724d04822) will focus purely on the financials and addressing what needs to be done to meet grid parity. Note that it will be number-driven.
