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Last Updated: January 24, 2018
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Matthew Peloso is a highly-driven entrepreneur whose goal is to establish commercial solutions using technology for a better world.

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1. Being named as one of the most innovative companies in 2016 by Fast Company, was surely a proud moment for you and Sun Electric. What is your advice for start-ups and entrepreneurs embarking in the solar industry business?

Be different, really different. Solve real problems. Bring industry problems close to you. Listen to your customers, and get ready for a marathon. Entrepreneurship isn’t a sprint.

2. Do you subscribe to a motto or philosophy in work/personal life?

This has changed a lot from when I started my entrepreneurship journey in 2012. I used to think that I could change the energy industry with innovation – and I was motivated a lot through the potential in knowing that I was doing the right thing, advancing and improving power for consumers and the future power sector. Through this period, I have come to learn that I can’t work through this on my own. I know now that it takes a group to work ahead on the advancement of the energy sector. It is up to us to see the benefits. Through this, I have learnt that we need to be objective and rational in the development of work and life.

3. You’ve been in the solar industry for several years now. Is there a significant achievement or milestone for you personally or for the company?

All around the world, the electricity sector has traditionally been heavily regulated. Despite the barriers to entry in a heavily regulated market, Sun Electric has made a lot of progress on its milestones. To date, we have sealed more than 32 MWp of solar projects in Singapore, allowing previously-underutilised roof spaces in Singapore to generate clean energy for their city. An increasing number of local businesses have taken up clean energy packages from Sun Electric which source their power from their own city’s rooftops. Companies big and small can now play their part for the environment and their city, while saving money off the electricity tariff and making money from their rooftops.

In addition, in June 2017, Sun Electric won the first SolarRoof contract from JTC, Singapore’s leading agency for industrial infrastructure. This 15-20 year contract will allow Sun Electric to install solar panels on the rooftops of 27 JTC buildings and export the solar energy for other users connected to them through the power grid, meaning we have succeeded in marking a new disruptive business model that is transforming the power market. Under existing solar leasing models, power generated primarily served only the building forcing rooftops out of utilisation. The new business model will allow Sun Electric to generate an additional 5 MWp of solar-generated electricity with JTC connecting users across cities. To solve that problem, instead of buildings, we think cities – and that is making all the difference.

4. If you were not doing what you’re currently doing now in the solar industry, what other career option do you think you might have pursued?

Before I set up Sun Electric, I was starting to explore career options in the legal industry and would have been involved in patent law and innovation inside a technology business. I had been a consultant for entrepreneurs, helping them look at ways to register intangible assets or develop them. I was also out in the solar industry looking for work in technology development. Luckily for me, no one made me an offer and I got to become an entrepreneur with the potential to transform the energy sector.

5. The energy industry is in transition at the moment. From the use of hydrocarbons to cleaner renewable energy options. What are your thoughts about when the demand for oil and gas will peak? 2025, 2030, 2035, 2040?

It is notoriously difficult to predict the demand for oil and gas. However, what is driving volumes in the renewable sector is a mix of continued support with the implementation of larger scale installations and price reduction. Outside of the transport sector, oil may already see its peak while gas and renewables come into the mix. However, the demand for gas would not disappear right away. Realistically, renewables cannot cover 100% of what you need unless there are dramatic improvements in storage capacity, so we work towards creating an achievable goal. We believe that most cities (in particular, densely populated cities) can generate about 10% of their power needs from their own rooftops and we are enabling this realistic target through the SolarSpaceTM platform for smart cities. We think setting something achievable is important for our world to look seriously at the renewable power industry to provide the largest benefits to electricity consumers.

6. As Sun Electric expands its presence globally (USA, Australia, Japan, and the Philippines), you will be planning to increase your workforce. What type of skills or characteristics are you looking for in a team member?

Given the heavily regulated nature of the power sector, it requires people with the discipline and patience to navigate through the dense thicket of regulations and the inertia of the sector. At the same time, we require creative individuals with the foresight to see through a new era of energy and to continue innovating. It is a tough mix to balance both skillsets required.

7. Can you tell us the biggest challenges Sun Electric has faced so far, and how did you overcome them?

Given that the energy/utilities sector has always been tightly regulated and that consumers are used dealing with the incumbents, the challenge we face is to give consumers the impetus to switch from their legacy power providers, and to challenge their conceptions around access to clean energy.

8. As Singapore is space constrained, do you see an emerging demand and market for offshore solar farms developing here?

There is some potential demand, which is essentially facilitated by the government. However, the focus on rooftops is still quite important as there are still so many under-utilised rooftops! I believe expertise developed here is much more important in terms of the evolution of the power sector than in offshore solar farms and focusing on rooftop solar provides our firm with capabilities which are significantly scalable and less expensive. Future cities will incorporate energy generating infrastructure within their own architecture. We don’t need to go far from the city to get power from our environment. It is right here already.

9. Other than in Singapore, where else do you think in Asia, has seen significant growth in the solar industry?

Apart from solar energy, Asia has access to multiple renewable energy options including wind, geothermal and hydro. Asia is also home to many densely-populated cities (e.g. Jakarta, Manilla, Bangkok) where demand for energy is high, putting a strain on the nation’s grid and creating the need for a renewable source of energy. However due to space constraints and lack of infrastructure, not all renewable energy sources are feasible.

Solar energy, we believe, remains the most viable renewable energy option for cities across Asia. Our business model has the potential to overcome the challenges faced by densely populated cities, such as space constraints and addresses limitations of intermittent power supply, as the solar-generated power is fully integrated with the grid. We believe that Sun Electric will facilitate the widespread adoption of solar energy, not only in Singapore but in these densely-populated cities across Asia.

10. Where do you see the industry in the next 10-20 years?

We expect major advancements in energy storage capacity (battery) to happen in the next 3-5 years. Tesla recently constructed one of the world’s biggest battery, the size of an American football field, in South Australia to address the country’s energy woes. If the technology proves to be sustainable, this would ease the problem of intermittency - solar will be able to serve not only as a peaking power resource but also be a source of base load power which is currently incapable of doing so. This will potentially change the future of energy globally. Improvements in data connectivity will be a big impetus for new energy technologies. The potential of this will be further enhanced when regulators open up the information systems architecture that traditional utilities companies have access to, to newer and more innovative companies in the power sector.

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Royal Dutch Shell Poised To Become Just Shell

On 10 December 2021, if all goes to plan Royal Dutch Shell will become just Shell. The energy supermajor will move its headquarters from The Hague in The Netherlands to London, UK. At least three-quarters of the company’s shareholders must vote in favour of the change at the upcoming general meeting, which has been sold by Shell as a means of simplifying its corporate structure and better return value to shareholders, as well as be ‘better positioned to seize opportunities and play a leading role in the energy transition’. In doing so, it will no longer meet Dutch conditions for ‘royal’ designation, dropping a moniker that has defined the company through decades of evolution since 1907.

But why this and why now?

There is a complex web of reasons why, some internal and some external but the ultimate reason boils down to improving growth sustainability. Royal Dutch Shell was born through the merger of Shell Transport and Trading Company (based in the UK) and Royal Dutch (based in The Netherlands) in 1907, with both companies engaging in exploration activities ranging from seashells to crude oil. Unified across international borders, Royal Dutch Shell emerged as Europe’s answer to John D Rockefeller’s Standard Oil empire, as the race to exploit oil (and later natural gas) reserves spilled out over the world. Along the way, Royal Dutch Shell chalked up a number of achievements including establishing the iconic Brent field in the North Sea to striking the first commercial oil in Nigeria. Unlike Standard Oil which was dissolved into 34 smaller companies in 1911, Royal Dutch Shell remained intact, operating as two entities until 2005, when they were finally combined in a dual-nationality structure: incorporated in the UK, but residing in the Netherlands. This managed to satisfy the national claims both countries make on the supermajor, second only to ExxonMobil in revenue and profits but proved to be costly to maintain. In 2020, fellow Anglo-Dutch conglomerate Unilever also ditched its dual structure, opting to be based fully out of the City of London. In that sense, Shell is following the direction of the wind, as forces in its (soon to be former) home country turn sour.

There is a specific grievance that Royal Dutch Shell has with the Dutch government, the 15% dividend tax collected for Dutch-domiciled companies. It is the reason why Unilever abandoned Rotterdam and is now the reason why Shell is abandoning The Hague. And this point is particularly existentialist for Shell, since its share prices has been battered in recent years following the industry downturn since 2015, the global pandemic and being in the crosshairs of climate change activists as an emblem of why the world’s average temperatures are going haywire. The latter has already caused the largest Dutch state pension fund ABP to stop investing in fossil fuels, thereby divesting itself of Royal Dutch Shell. This was largely a symbolic move, but as religious figures will know, symbols themselves carry much power. To combat this, Shell has done two things. First, it has positioned itself to be at the forefront of energy transition, announcing ambitious emissions reductions plans in line with its European counterparts to become carbon neutral by 2050. Second, it is looking to bump up its dividend payouts after slashing them through the depths of the Covid-19 pandemic and accelerating share buybacks to remain the bluest of blue-chip stocks. But then, earlier this year, a Dutch court ruled that Shell’s emissions targets were ‘not ambitious enough’, ordering a stricter aim within a tighter timeframe. And the 15% dividend tax remains – even though Prime Minister Mark Rutte’s coalition government has been attempting to scrap it, with (it is presumed) some lobbying from Royal Dutch Shell and Unilever.

As simplistic it is to think that Shell is leaving for London believes the citizens of the Netherlands has turned its back on the company, the ultimate reason was the dividend tax. Reportedly, CEO Ben van Buerden called up Mark Rutte on Sunday informing him of the planned move. Rutte’s reaction, it is said was of dismay. And he embarked on a last-ditch effort to persuade Royal Dutch Shell to change its mind, by immediately lobbying his government’s coalition partners to back an abolition of the dividend tax. The reaction was perhaps not what he expected, with left-wing and green parties calling Shell’s threat ‘blackmail’. With democracy drawing a line, Shell decided to walk; or at least present an exit plan endorsed by its Board to be voted by shareholders. Many in the Netherlands see Shell’s exit and the loss of the moniker Royal Dutch – as a blow to national pride, especially since the country has been basking in the glow of expanded reputation as a result of post-Brexit migration of financial activities to Amsterdam from London. The UK, on the other hand, sees Shell’s decision and Unilever’s – as an endorsement of the country’s post-Brexit potential.

The move, if passed and in its initial stages, will be mainly structural, transferring the tax residence of Shell to London. Just ten top executives including van Buerden and CFO Jessica Uhl will be making the move to London. Three major arms – Projects and Technology, Global Upstream and Integrated Gas and Renewable Energies – will remain in The Hague. As will Shell’s massive physical reach on Dutch soil: the huge integrated refinery in Pernis, the biofuels hub in Rotterdam, the country’s first offshore wind farm and the mammoth Porthos carbon capture project that will funnel emissions from Rotterdam to be stored in empty North Sea gas fields. And Shell’s troubles with activists will still continue. British climate change activists are as, if not more aggressive as their Dutch counterpart, this being the country where Extinction Rebellion was born. Perhaps more of a threat is activist investor Third Point, which recently acquired a chunk of Shell shares and has been advocating splitting the company into two – a legacy business for fossil fuels and a futures-focused business for renewables.

So Shell’s business remains, even though its address has changed. In the grand scheme of things, never mind the small matter of Dutch national pride – Royal Dutch Shell’s roadmap to remain an investment icon and a major driver of energy transition will continue in its current form. This is a quibble about money or rather, tax – that will have little to no impact on Shell’s operations or on its ambitions. Royal Dutch Shell is poised to become just Shell. Different name and a different house, but the same contents. Unless, of course, Queen Elizabeth II decides to provide royal assent, in which case, Shell might one day become Royal British Shell.

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