September 11, 2023
SINGAPORE – Singapore could start importing two gigawatts (GW) of renewable energy annually from Indonesia within five years, in what is the Republic’s biggest effort so far to import low-carbon electricity.
The imports would account for about 15 per cent of Singapore’s annual needs, and would constitute the country’s largest cross-border electricity contract to date.
Combined with a similar deal to grant conditional approval to import 1GW of electricity annually from Cambodia, Singapore is three-quarters of the way to reaching its import target of up to 4GW of electricity a year by 2035.
The Energy Market Authority (EMA) said on Friday that it was granting conditional approval to five projects to import a total of 2GW of low-carbon electricity from Indonesia into Singapore
The five companies managing the projects are: Pacific Medco Solar, Adaro Solar International, EDP Renewables Asia-Pacific, Vanda RE and Keppel Energy.
Second Minister for Trade and Industry, Dr Tan See Leng, told The Straits Times on Friday that the granting of these approvals was a “watershed moment” for Singapore’s green energy ambitions.
“Singaporeans should have every confidence that we are on track to meet our target of importing 4GW of low-carbon electricity by 2035, like what we have committed to earlier on in the year,” he said.
The EMA said that conditional approvals are granted after an initial assessment that the proposed electricity import projects are technically and commercially viable.
“Conditional approvals facilitate companies in obtaining the necessary regulatory approvals and licences for their projects,” said the authority.
These approvals build on multiple agreements between Indonesia and Singapore in the area of energy cooperation, including one on low-carbon energy and cross-border electricity interconnection.
This latest agreement was signed on Friday by Indonesia’s Minister of Energy and Mineral Resources Arifin Tasrif and Dr Tan on the sidelines of the Indonesia Sustainability Forum in Jakarta.
In a speech at the event held at the Park Hyatt hotel, Dr Tan said the agreement provided specificity on areas of collaboration between the two countries, and would provide a robust framework to facilitate projects.
“The world is undergoing a profound energy transition. We must get to net-zero while preserving energy security and economic competitiveness,” said Dr Tan.
“Through international collaborations, we can work together to jointly plan and implement our energy transitions, and progress towards a shared energy future.”
In a joint release by Singapore’s Ministry of Trade and Industry and Indonesia’s Ministry of Energy and Mineral Resources, Mr Arifin also held up the agreement.
“As we strengthen our connections across borders, we are creating an ecosystem of energy flow that transcends geographical boundaries,” he said. “This spirit of interconnectivity goes beyond power lines and pipelines; it represents a mutual and equal cooperation between our nations.”
Singapore and Indonesia signed related agreements in January 2022 and in March this year.
EMA said that these deals affirm both countries’ commitment to facilitating cross-border electricity trading projects and interconnections between Indonesia and Singapore, as well as investments in the development of renewable energy manufacturing industries.
Such industries include solar photovoltaics (PV) and battery energy storage systems (BESS), with the five agreed upon projects to facilitate the setting up of manufacturing plants in Indonesia.
“These projects aim to progressively install approximately 11 gigawatt-peak (GWp) of PV plants and approximately 21 gigawatt-hours (GWh) of BESS, and aim to commence commercial operations from end 2027,” said EMA.
The five companies handling the power import projects will, among other things, conduct marine surveys on the proposed route for their subsea power cables, as approved by the Indonesian authorities, as well as support equipment manufacturing.
This comes after a similar approval was granted to Keppel Energy in March to import 1GW of low-carbon electricity from Cambodia.
“Together, the 3GW of conditional approvals bring Singapore closer to its ambition to import up to 4GW of low-carbon electricity by 2035,” said EMA.
It added that it would continue to review electricity import proposals received, with a view to granting more conditional approvals.
Singapore’s moves to import electricity are in tandem with other efforts to make the country more sustainable by investing in green energy.
For instance, Singapore-based Vena Energy is aiming to start construction of its 2GW solar and battery project in Indonesia’s Riau Islands in 2026, with a view to supply electricity to Singapore before 2030.
Dr Tan highlighted how the conditional approvals have furthered Indonesia’s and Singapore’s green energy ambitions.
He said the fact that half of Singapore’s current electricity import target comes from Indonesia is testament to the comprehensive and longstanding partnership between the two countries, and their joint ambition to find opportunities that will allow their people to prosper together.
He told ST that these efforts will also contribute to the region’s goal of establishing an Asean power grid.
This potential project, which came up during the recent Asean Summit and related meetings, would bring together sources of green electricity in the region and make energy consumption more sustainable.
Such a grid will make the most of South-east Asia’s potential in renewable energy, and bolster energy resilience for people in Singapore and the region.
Dr Tan added that energy security, resilience and reliability have become “even more guaranteed” as a result of the diversification of energy sources.