Green energy firm to invest $10b for S'pore hub, regional projects

World's 4th largest such company plans to establish its Asia-Pacific headquarters here

EDP Renewables (EDPR), the world's fourth-largest renewable energy producer, will invest $10 billion by 2030 to establish its Asia-Pacific headquarters in Singapore, while continuing to develop new clean energy projects across the region, the company said yesterday.

The Portuguese company also concluded its $1.1 billion purchase of 91 per cent of Singapore renewable energy firm Sunseap, which will serve as a launchpad for the European firm's regional investments.

The acquisition, announced in November last year, will include Sunseap's pipeline of renewable energy projects in Asia. The projects are in various stages of development and have a combined capacity of 10 gigawatts.

EDPR and Sunseap will embark on renewable energy initiatives focused on solar and wind projects across the Asia-Pacific, while targeting opportunities for cooperation in energy storage and green hydrogen, the companies said in a joint statement.

In July last year, Sunseap announced it would build the world's largest floating solar farm and power storage system on the Indonesian island of Batam.

The US$2 billion (S$2.7 billion) complex is slated to be developed on the Duriangkang Reservoir in southern Batam island, near Singapore. The company said the project is expected to be completed by 2024.

Sunseap has also signed a memorandum of understanding along with a consortium of companies to develop solar power systems in the neighbouring Riau islands of Indonesia to provide electricity to Singapore. These systems will have a combined 7 gigawatt-peak capacity.

Head of Asia renewables research at Rystad Energy Chew Jun Yee said EDPR setting up its headquarters here reaffirms Singapore's position as a platform for clean energy investments into South-east Asia.

He added that the European firm's investment in Sunseap will help Singapore decarbonise, as 95 per cent of its electricity is generated from gas. This will be aided by Sunseap's commitment to importing renewable energy from Indonesia.

The diversification of energy supply sources for power generation has become especially critical for Singapore consumers, who have had to grapple with rising domestic power prices due to a global energy crunch that started at the back end of 2021, and has been exacerbated by Russia's attacks on Ukraine.

Singapore imports almost all of its energy and cannot be insulated from such developments in the global market, but more efficient use supplemented by sustainable renewable solutions on the margins can help it to buffer cycles of crisis in the future, said Mr Henning Gloystein, director of energy, climate and resources at the Eurasia Group.

EDPR's Asia-Pacific chief operating officer Pedro Vasconcelos said the conclusion of the agreement to purchase a majority stake in Sunseap was a reflection of EDPR's ambitions to expand its global portfolio.

"The Asia-Pacific region is a strategic market for us towards EDPR's global positioning, with both high demand and growth potential in the renewable energy sector," he said.

"Sunseap will undoubtedly become a key growth lever for EDPR, whose presence in the region will in turn drive local economic development."

Sunseap co-founder Frank Phuan said: "With EDPR's financial muscle and expertise in renewables, Sunseap will be able to accelerate growth plans and revolutionise the energy landscape in the region, as well as nurture the next generation of talent in the industry."

Mr Miguel Stilwell d'Andrade, chief executive of EDPR and its parent company, said: "Sunseap, together with EDPR's complementary expertise, is now better equipped to drive the energy transition and mitigate climate change for the entire Asia-Pacific region, fostering sustainability as a key engine for growth and green jobs, and contributing to Singapore's ecosystem of clean energy."

Singapore's Economic Development Board (EDB), which aims to strengthen the country's position as a global centre for business, innovation and talent, played a pivotal role in bringing both parties together.

Ms Jacqueline Poh, managing director of EDB, said in the statement: "Renewable energy is essential for Singapore and companies in the Asia-Pacific region to achieve our net-zero ambitions."

She added that "EDPR's investment in Sunseap will boost Singapore's efforts in accelerating the region's energy transition through renewable energy project development, green finance and carbon trading, while also creating new jobs for Singaporeans in the solar and wind value chain".

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A version of this article appeared in the print edition of The Straits Times on February 25, 2022, with the headline Green energy firm to invest $10b for S'pore hub, regional projects. Subscribe