Excellencies and Distinguished Guests,
Ladies and Gentlemen,
1. Good morning and a very warm welcome to the 17th edition of the Singapore International Energy Week (SIEW).
2. 2024 has been a sobering year that further drives home the impact of climate change.
a. From hurricanes and tropical storms, to wildfires and heatwaves, the world has been battered by extreme weather events.
b. Unfortunately, this is likely to get worse in the years to come.
c. There is therefore growing urgency for us to accelerate the current pace of decarbonisation.
3. Energy transition is at the heart of the shift to a low-carbon future.
a. Today, the production and consumption of energy account for more than 85 per cent of global carbon dioxide (CO2) emissions.
b. Reducing these emissions will require adjustments to both production and consumption.
i. Production must progressively shift to a cleaner energy mix;
ii. While consumption must shift to greater energy efficiency.
c. The pace of these adjustments will depend on our ability to deploy low-carbon technologies at scale.
i. A study by McKinsey identified 12 categories of climate technologies that could potentially reduce more than 90 percent of total man-made greenhouse gas emissions by 2050 if deployed extensively.
ii. Of this –
1. Commercially competitive technologies constitute only 10 percent of the abatement potential presently. These include solar, onshore wind, hydro and large nuclear plants.
2. An additional 45 percent will have to come from technologies which require support to be competitive; these include offshore wind, biofuels and heat pumps.
3. And a further 40 percent is attributed to technologies that have been demonstrated or proven in prototypes but not yet deployed at scale; these include small modular reactors, carbon capture, and e-fuels, which are synthetic fuels made from renewable energy.
d. We must therefore press ahead on three fronts:
i. First, accelerate the deployment of low-carbon solutions that are commercially mature;
ii. Second, invest in the commercialisation of solutions that are technologically feasible; and
iii. Third, to drive further research and development into technologies that are less mature.
4. While Singapore is small and only contributes 0.1% of global emissions, we will do our part to transition to a low-carbon world.
a. We will peak our emissions before 2030 and achieve net-zero by 2050.
b. This will not be easy, given our limited land surface for solar deployment and the lack of wind or hydro-electric power.
c. Let me outline our approaches to navigate the energy transition along three dimensions – resilience; reliability; and responsiveness.
Resilience
5. I will start with resilience. This is at the heart of our “four switches” approach – comprising natural gas, solar, power imports, and low-carbon alternatives.
6. Over the years, we have made good progress on each of these switches.
Solar
7. Let me start with solar. We are scaling up solar deployment as much as we can because this is our most viable source of renewable energy domestically.
a. Five years ago, we announced at SIEW that we would increase our installed solar energy to at least 2 gigawatt-peak (GWp) by 2030.
b. At that time, the total installed solar capacity stood at a modest 260 megawatt-peak (MWp).
8. We have since achieved an installed solar capacity of 1.35 GWp – a fivefold increase from 2019. This puts us on track to meeting our solar deployment target of at least 2 GWp by 2030.
9. At the same time, we need to step up the deployment of energy storage systems to manage solar intermittency.
a. Last year, we commissioned a battery energy storage system on Jurong Island, which allows us to counteract sharp and unexpected drops in solar energy.
b. EMA and Sembcorp are in discussions to expand the system and increase the land use density in tandem.
Imports
10. Let me move on to the second switch – low-carbon electricity imports.
11. In 2021, I announced our plans to import up to 4 GW of low-carbon electricity by 2035. Last month, we announced that we would raise this target to around 6 GW by 2035, or around one-third of our energy needs.
12. We have made some progress towards this target.
a. We have issued Conditional Licences to five projects from Indonesia to import a total of 2 GW of low-carbon electricity to Singapore.
b. We have also issued Conditional Approvals to four other projects, to import an additional 3.6 GW of low-carbon electricity from Cambodia, Indonesia and Vietnam.
13. In the meantime, we have kickstarted cross-border electricity trading with Malaysia.
a. Last month, we doubled the capacity of electricity traded under the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project to 200 MW.
b. In time, these efforts will deepen energy integration and support the advancement of the ASEAN Power Grid. Minister Tan See Leng will share more at the Asia Clean Energy Summit tomorrow morning.
Low-carbon alternatives
14. Let me move on to low-carbon alternatives.
15. Two years ago, we unveiled our National Hydrogen Strategy, outlining our commitment to research, pilot and collaborate on the use of hydrogen. Since then, we have made progress on multiple fronts.
a. Last year, we invited a number of consortia to participate in a Request for Proposal for a pilot project on Jurong Island to explore the use of low carbon ammonia for power generation and maritime bunkering.
i. We have since shortlisted two consortia. They will commence preliminary Front-End Engineering Design studies by the end of this year.
ii. This pilot will allow us to gain valuable experience in managing low carbon ammonia supply chains.
b. We must also drive further research and development into the safe and efficient use of hydrogen.
i. We had launched the Low Carbon Energy Research (LCER) Funding Initiative and allocated over $180 million since 2020 to support research into low-carbon energy technologies, including hydrogen.
ii. Earlier this year, we launched the Centre for Hydrogen Innovations at the National University of Singapore.
1. The Centre, which is first-of-its-kind in Southeast Asia, will collaborate with industry to advance hydrogen research across the entire value chain.
2. This will support our efforts to raise the readiness of hydrogen technologies and market.
16. I said last year that we are carefully studying nuclear energy. Recent developments have demonstrated the importance of staying abreast of this field. Major technology companies, such as Amazon and Google, have announced sizable deals with small reactors developers to meet their increasing needs for low-carbon energy.
17. We are keeping a close watch and have taken two steps this year to build up our capabilities.
a. We signed a civil nuclear cooperation agreement with the United States, otherwise known as a “123 Agreement”.
i. This agreement will enable us to deepen cooperation with the US on advanced nuclear energy technologies, including small nuclear reactors.
ii. It will also allow us to collaborate with other countries that use nuclear energy technologies and designs containing components or intellectual property of US origin.
b. As part of our capability building efforts, we are aiming to build up a pool of about 100 nuclear safety experts in the medium to long run.
18. We have ongoing studies to assess the potential of other promising low-carbon energy sources, such as geothermal energy and biofuels, to meet Singapore’s electricity needs.
19. Even as we deploy more solar power, push for imports of low-carbon electricity and develop alternative energy, we will continue to need natural gas during the energy transition. That said, we have to explore pathways to decarbonise natural gas, such as Carbon Capture.
20. To this end, EMA will be releasing a Grant Call for Carbon Capture and Storage feasibility studies for the power sector. These studies would allow us to better understand the cost and infrastructure requirements for capturing the emissions from our Combined Cycle Gas Turbines.
Reliability
21. I have described at some length our efforts to build resilience through our Four Switches. As we navigate towards a cleaner energy future, we must ensure an orderly transition. This brings me to the next dimension – reliability.
22. Natural gas will continue to play a crucial role in safeguarding our energy security. We must therefore ensure we have a stable and secure supply of natural gas.
a. At last year’s SIEW, I shared that Singapore will set up a central gas entity, or Gasco, to centralise the procurement and supply of gas to the power sector.
b. This approach will enable us to negotiate more favourable gas contracting terms, enter into longer-term gas contracts for more stable prices and supply, and procure gas from diverse sources to reduce concentration risk.
c. We will set up Gasco as a fully Government-owned company by the end of this financial year.
23. In tandem, we must also enhance our infrastructure to support the import of natural gas.
a. Last year, PM Lawrence Wong announced SLNG’s plans to develop a Second LNG Terminal, to meet the growing demand for natural gas.
b. I am pleased to share that SLNG will develop the Second LNG Terminal at Jurong Port, as an offshore terminal which will include a new floating storage and regasification unit. The new terminal will have 5 million tonnes per annum of throughput capacity, a 50% increase of our existing LNG capacity.
c. I look forward to the launch of the Second LNG Terminal project during SIEW.
Responsiveness
24. Thus far, I have spoken about our moves to ensure a clean and reliable energy supply. But there is another critical aspect of our energy system which we must not overlook – our electricity grid.
25. Grids play a critical role in the distribution of energy. In some countries, economic growth plans or decarbonisation plans have been hampered because electricity cannot be transported from where it is produced to where it is needed. We must therefore continue to prioritise timely grid connections, improve the responsiveness of grid capacity to demand signals, and develop new grid capabilities for a heterogenous energy mix.
26. First, on energy grid connections.
a. We recognise that timely infrastructure connection timelines are important to companies. Singapore today is more developed than before, with less greenfield sites available. This may affect infrastructure development timelines.
b. We are reviewing our investments in grid connections so that companies can continue to have timely access to power.
27. Second, we want to enhance the responsiveness of our grid to demand changes.
a. Demand management measures offer several benefits.
i. By nudging consumers to shift to off-peak periods, we avoid running more expensive power generation units during peak hours, and thus save costs at the system level.
ii. In the long run, this will help us reduce investments in units that are largely required just to meet peak demand.
iii. This will also improve systems ability and reliability, by relieving stress on the grid during high-demand periods and unplanned outages.
b. EMA has been administering a Demand Response programme that incentivises consumers to reduce their electricity consumption during periods of high demand. EMA will expand the Demand Response programme to include two new groups of consumers.
i. One, businesses with behind-the-meter Battery Energy Storage Systems (BESS) will be allowed to participate in the programme.
1. Such businesses can use their batteries to shift their electricity consumption from peak to non-peak periods.
2. They are in a good position to benefit from the Demand Response programme.
ii. Two, we will extend the Demand Response programme to EV charging systems under a pilot.
1. EV charging operators will be motivated to adjust their charging speeds in response to demands on the grid. This will enhance our ability to balance demand and supply in the electricity grid.
2. EMA has signed a Memorandum of Understanding with ComfortDelGro to collaborate on this pilot via a regulatory sandbox.
3. We welcome more EV charging operators to join us in this effort.
28. This brings me to my final point on the grid. We will enhance our grid infrastructure so that it will be more responsive to changes in supply and demand.
a. We need to prepare our grid to integrate distributed energy sources, such as rooftop solar panels and energy storage systems.
i. It may not be commercially viable for each device to individually provide services to the grid.
ii. But they can be aggregated to operate as a single, coordinated unit providing energy and ancillary services. This concept is known as a “Virtual Power Plant”.
iii. To advance this concept, EMA will launch an industry consultation and Request for Proposal to pilot VPPs via a regulatory sandbox. EMA will also collaborate with the SP Group to validate the potential of VPPs as a reliable generation source for the grid.
b. We would need to prepare our grid for rising peak demand, even as we try to manage this through Demand Response programmes.
c. In response to these challenges, EMA, in collaboration with SP Group, will launch the Future Grid Capabilities Roadmap later this year. This roadmap will outline strategies to harness distributed energy resources for enhanced grid stability, improve grid management, and address emerging system needs like inertia management.
Conclusion
29. The task ahead to transform the global energy system is monumental.
30. Singapore may be small, but we stand ready to play our part in the energy transition. To increase the sustainability of our power supply, we will need to develop and study every possible decarbonisation pathway, while safeguarding our energy security and ensuring cost competitiveness.
31. But we cannot do it alone. International collaboration is critical. In this spirit, I am delighted to officiate today the opening of the International Energy Agency’s (IEA) first Regional Cooperation Centre outside its Paris headquarters, here in Singapore.
a. This is the first energy-focused international organisation that Singapore is hosting.
b. The Centre will serve as a hub for the IEA’s engagements in Southeast Asia and beyond.
c. Such partnerships are especially pertinent given the theme of this year’s SIEW – “A Connected and Sustainable Energy World”.
32. In the week ahead, let us strengthen our partnerships and shape a sustainable energy future together. May our conversations be bold, our ideas innovative, and our collaborations fruitful.
33. Thank you.