Electrification to decarbonise Singapore’s energy system

With electricity generation accounting for 35% of emissions in Singapore, yet 95% of the country’s energy generated from fossil fuels, what role can electrification play to decarbonise the sector?

During the Future of the Grid summit, a panel comprising representatives from energy generators, consulting firms, investors, and smart energy solutions providers, discussed various measures that can be implemented to help Singapore reduce its reliance on natural gas and decarbonise its economy.

Graeme York, the CEO of utility firm Senoko Energy, said: “If we do not do something to decarbonise with electrification we will fail to achieve sustainability targets or even to remain relevant in a rapidly changing global market.”

He said energy efficiency is one big tool utilities and consumers must consider to decarbonise. York said efficiency has the potential to help relieve stress on grid networks and allow utilities to expand their portfolio of renewable energy capacity.

He added that although Singapore has gradually moved away from coal and increased its reliance on natural gas, digital tools and combined cycle power plants will help accelerate the transition to more clean resources. Today, Singapore generates 95% of its electricity from natural gas.

“Coal-fired plants are hard to finance now and no longer have the same social licence to operate than before. Now what is left for Singapore is to move away slowly from natural gas to other eco-friendly resources,” said York.

The CEO of Senoko added that Singapore can also take advantage of the prosumer model and use cases such as peer-to-peer trading and other emerging technologies to ensure sustainable energy generation and supply.

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Renewable energy costs and deployment

He reiterated that although the costs of renewable energy continue to decline, thereby providing an opportunity for Singapore to diversify and decarbonise its energy mix, issues such as fluctuations will pose huge challenges in the country’s energy transition.

The prices of solar and battery storage have dropped by more than 80% over the past ten years, according to Eric Jost, Partner, Power & Utilities Consulting, Ernst & Young Advisory. 

John Ng Peng Wah, the CEO of electricity producer, YTL PowerSeraya, added: “Reductions in renewables cost increased technology availability, however, the cost of deploying is still not cost-effective.”

Peng Wah, added: “In Singapore we are land-scarce and as a result, the typical renewables, hydro, geothermal, solar, wind and nuclear, are not available for us.”

He said that although at a slower pace, electrification is definite in Singapore owing to increasing pressure to decarbonise. However, it will result in a huge spike in energy demand which will pose massive constraints to utilities, he added.

And as such “we must make sure the energy transition is well designed and approached because the more renewables we will have in the mix, the more vulnerable we will be to volatility,” he emphasised.

Peng Wah gave an example of the increases in European energy prices as a perfect storm brewed due to the lack of a detailed approach to renewables adoption. PowerSeraya’s CEO said before the Singapore government can switch to renewables, mechanisms including ensuring enough renewables and storage capacity is deployed need to be put in place to avoid intermittency.

Nuclear energy and industry collaboration

Hsien-Hui Tong, Executive Director – Investments, at state entity SGInnovate, said although Singapore is currently not considering nuclear energy, the resource offers a huge path to decarbonise.

He said that by 2035 nuclear could be viable technology that Singapore can take advantage of for energy security and decarbonisation, considering neighboring Indonesia has already started embarking on projects with startups.

Michael Wong, the CEO of Tuas Power, reiterated that “there is no single solution in decarbonising the country’s energy system.”

He said collaboration between various organisations including government agencies and energy generators, the public sector and financers will help in identifying and implementing decarbonisation solutions.

He emphasised the role consumers will play in simplifying and making the energy transition a reality. He said solutions will need to be consumer-driven and centric because an energy transition without consumer buy-in will likely fail.

Find out more about the Creating an Electrified Economy session.